Rob from the poor and give to the rich? Robinhood prompts furious backlash after restricting trades
One week in review:
Jan. 24–30 We've selected the hottest materials of the past week for you to stay up to date with the latest crypto news: | | #1. Rob from the poor and give to the rich? Robinhood prompts furious backlash after restricting trades | | | Day traders have helped GameStop stock surge from $17.25 on Jan. 4 to highs of $483 this week — a 2,700% rise for a retailer struggling to survive in an online world. This inflicted billions of dollars of pain on established investors caught up in the short squeeze. | | | But Robinhood caused controversy when it restricted trades on GME stock, as well as other r/Wallstreetbets targets, including AMC Entertainment, BlackBerry and Nokia. The investing app, which has proven popular with millennials, was accused of preventing average investors from fighting back against hedge funds manipulating the market. | | | The SEC is now looking into Robinhood's handling of GameStop trading, with Congress announcing hearings into the practice of short selling. | | #2. Bitcoin soars by $5,000 in minutes — BTC hits $38,000 after Elon Musk's 'Dogecoin treatment' | | | The GameStop saga can be linked to several of the other top stories this week. Tesla CEO Elon Musk has been among those cheering on r/Wallstreetbets, and this week, he offered a ringing endorsement of crypto as an alternative. | | | The world's richest man quietly added "#bitcoin" to his Twitter bio… with BTC surging by more than $5,000 within minutes as a result. This helped turn the fortunes of the world's biggest cryptocurrency around, as it had been at peril of losing support at $30,000. | | #3. Ripple demands to know why Ether isn't a security as XRP defense gets desperate | | | The embattled firm has filed a Freedom of Information Act request that demands information "about how the SEC determined the status of Ether as a non-security." | | | Representatives at the SEC have said that, while Ether's presale may have been a securities offering at the time, ETH is now sufficiently decentralized and qualifies as a commodity. | | #4. Prediction of the week: Guggenheim says institutional demand not enough to keep BTC above $30,000 | | | Speaking to Bloomberg, Guggenheim's Scott Minerd said: "Right now, the reality of the institutional demand that would support a $35,000 price or even a $30,000 price is just not there. I don't think the investor base is big enough and deep enough right now to support this kind of valuation." | | | Minerd also believes that the downward pressure has a lot further to go, explaining that it is "not uncommon to see squeezes like this." | | | On Jan. 20, Minerd told CNBC that he expects prices to retrace back to $20,000. | | #5. FUD of the week: Apple updates iOS to fix crypto wallet security vulnerabilities | | | Apple has issued new security updates for its mobile operating system after the iPhone maker discovered vulnerabilities that could compromise crypto wallets. | | | The security updates, which were released Tuesday, affect iOS 14.4 and iPadOS 14.4. The vulnerabilities reportedly allowed hackers to gain remote access to a target system, thereby exposing the user's cryptocurrency wallet. | | #6. FUD of the week: Crypto crime dropped 57% in 2020, but DeFi hacks surged, CipherTrace says | | | Crimes targeting the virtual currency sector decreased by more than half in 2020, according to blockchain security firm CipherTrace. | | | Overall losses from crypto theft, hacks and fraud fell 57% in 2020 to $1.9 billion, due mainly to improved security systems — but it wasn't all good news. | | | Last year also saw a surge in crime related to decentralized finance, and the majority of incidents were "rug pulls." This is where a token is artificially hyped and inflated, with the creators and early investors pulling the plug after the pump, leaving the latecomers out of pocket. | | | CipherTrace's report warned that 50% of all crypto hacks were linked to DeFi protocols, with 99% of major fraud volume in the second half of 2020 stemming from rug pulls. | | | Feel free to explore the most important news with Hodler's Digest: | | | |
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