Cryptocurrencies drop after a scathing hacking report
The price of cryptocurrencies declined sharply after a damning report by analysis firm Chainalysis which indicated two firms responsible for the stealing of currencies worth more than a billion dollars. The report also showed that the two companies – known as Alpha and Beta - were continuing the malpractice of stealing currencies. Each of the hacks they conduct is worth about $90 million. Once they steal crypto, the companies wait for more than three months before they cash out. They do this to avoid detection by the authorities. The report added that:
The hackers typically move stolen funds through a complex array of wallets and exchanges in an attempt to disguise the funds’ criminal origins. The hackers then often observe a quiet period of 40 or more days in which they don’t move funds, waiting until interest in the theft has died down. Once they feel safe, they move quickly. At least 50% of the hacked funds are cashed out through some conversion service within 112 days.
Since the invention of the cryptocurrencies industry, theft has been a major concern. This is because many exchanges have been hacked leading to the loss of cryptocurrencies worth billions of dollars. Tracking the stolen transactions has become very difficult because of how the industry was created. Therefore, companies that would accept the currencies have largely abandoned the industry because they fear that their funds will be stolen.
After the report was published, the price of Ethereum and other currencies dropped sharply. The price reached an intraday low of $99.99. This price was below the 21-day and 42-day EMAs. The RSI also dropped to 20, which is viewed as an oversold level. With the sentiment of the currencies being lower, there is a possibility that the price will continue moving lower to test the previous lows of 79.