DOJ Indicts Three People for $400M FTX SIM Swap Hack

DOJ Indicts Three People for $400M FTX SIM Swap Hack

DOJ targets trio for $400M FTX hack, Polygon Labs cuts staff, Blast's code controversy, and Puffer Finance's $200M launch impact.

Welcome to the final edition of Datawallet Daily for the week. As always, we’ve curated the must-know crypto stories from the last 24 hours just for you:

DOJ Indicts Three People for $400M FTX SIM Swap Hack

The Department of Justice has indicted three individuals, Robert Powell, Emily Hernandez, and Carter Rohn, for their involvement in a $400 million SIM-swapping hack. This sophisticated cybercrime, conducted from March 2021 to April 2023, targeted several victims, including employees of the now-defunct FTX exchange. 

The indictment, lodged in the U.S. District Court for the Northern District of Illinois, alleges that the trio executed SIM-swapping scams to gain unauthorized access to FTX’s online accounts, though FTX is not explicitly named in the filing. Bloomberg, citing sources, identifies FTX as the primary victim in this scheme.

The indictment charges Powell, Hernandez, and Rohn with conspiracy to commit wire fraud and identity theft. According to the indictment, the hackers manipulated an AT&T account belonging to an FTX employee, enabling them to control FTX’s online accounts and siphon off $400 million in cryptocurrency. This heist further complicates the narrative of FTX’s collapse, which filed for Chapter 11 bankruptcy in November 2022 amidst allegations of mismanagement and misuse of client funds by its executives.

Polygon Labs Slashes 19% of Workforce for Efficiency

Polygon Labs has announced a 19% reduction in its workforce, eliminating 60 roles, as part of an initiative to enhance performance, rather than due to financial constraints. This move is aimed at streamlining operations within the Ethereum-centric development firm. The downsizing is also coupled with the upcoming spin-off of the Polygon ID team. 

To mitigate the impact on remaining employees, Polygon Labs plans to increase their total compensation by at least 15% and abolish geo-pay models. This decision follows a previous layoff in February 2023, reflecting the company’s commitment to executing its mission efficiently despite the challenges involved.

Blast Faces Accusations of Unethical Optimism Code Fork

Blast, the Layer 2 project associated with the Blur NFT marketplace, faces allegations of improperly using Optimism’s open-source code. Accusations surfaced when Pop Punk, founder of Gaslite, highlighted nearly identical codebases between Blast and Optimism, suggesting that Blast made minor alterations without crediting the original creators. 

The incident raises concerns about ethical practices in software development, especially regarding open-source licensing and attribution. Critics also question Blast’s promotional strategies, such as promising yields for early depositors without delivering substantial code or security assurances, despite collecting significant assets. 

Puffer Finance Draws $200M in First Day with Liquid Restaking

Puffer Finance, a new liquid restaking (LRT) protocol, has made a significant entrance by amassing nearly $200 million in TVL on its first day, ranking third in the LRT sector. The protocol’s launch included a “vampire attack” to convert Lido’s stETH into its own LRT, pufETH, which contributed to its rapid growth. 

The LRT space, building on the concept of liquid staking tokens like stETH, has expanded swiftly, surpassing $1 billion in TVL. LRTs offer the dual benefits of staking rewards and additional yields through native restaking on platforms like EigenLayer. 

Other breaking news

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