The first week of June has been exciting for the blockchain and cryptocurrency world. Perhaps the biggest news is that the US Securities and Exchange Commission (SEC) filed suit against Kik for conducting an unregistered securities sale in its 2017 initial coin offering (ICO). In a filing submitted Tuesday, the SEC wrote that Kik violated Section 5 of the Securities Act of 1933, which requires the registration of offerings. For many years, Kik had lost money on its sole product, an online messaging application, and the company predicted internally that it would run out of money by 2017. So Kik sold its Kin (KIN) tokens to the public and accredited investors for a discount, raising more than $55 million from US investors. Last month, Kik CEO Ted Livingston launched a $5 million "Defend Crypto" crowdfunding campaign to fund a potential lawsuit. The price of Kin plunged over 25% on the lawsuit news.
Here is the rest of the week in review:
Hackers reportedly stole almost $10 million worth of Ripple (XRP) tokens from GateHub, a British cryptocurrency wallet service. GateHub revealed the security incident with a statement on June 6. GateHub said it was told by some of customers and community members that funds on their wallets had been stolen. The company estimated that hackers managed to compromise around 100 XRP Ledger wallets and steal 23.2 million XRP from around 85 victims. The hackers have already tried to launder or convert half of the stolen Ripple tokens with mixing services, dark web transactions, and exchange trades. GateHub started an investigation into the attack, but it is unlikely that the victims will be able to recover their entire losses.
The US Senate is confirming Heath Tarbert as the new chairman of the Commodity Futures Trading Commission (CFTC), which regulates derivates, digital assets, and over-the-counter trading. The CFTC selected Tarbert to replace outgoing head J. Christopher Giancarlo, affectionally known in the crypto community as "crypto dad." Under Giancarlo's tenure, the CFTC has pursued a light-handed regulatory approach toward the cryptocurrency sector in the name of financial modernization. Tarbert, who served as Acting Under Secretary for International Affairs and Assistant Secretary for International Markets, will take over the CFTC after July 15.
Crypto prices corrected this week to under $245 billion due to strong selling at resistance levels of Bitcoin (BTC). For the majors, EOS, Bitcoin Cash (BCH), and Ethereum (ETH) fell by double digits, while Litecoin (LTC) made slight gains. In the top 100, the biggest losers were Factom (FCT), down 29%, BitTorrent (BTT), down 26%, and MonaCoin (MONA), down 24%. The biggest gainers were GXChain (GXC), up a whopping 109%, HedgeTrade (HEDG), up 39%, and HyperCash (HC), up 29%. Next week traders will watch for a bounce from the $250 billion level.
The author owns a small amount of BTC and LTC.