SafeMoon, a decentralized finance project exploited in March, resulting in a net loss of $8.9 million in BNB, has been charged by the United States Securities and Exchange Commission and its key executives for security rules violations and frauds.
The funds associated with the exploit have been on the move via centralized exchanges and Match System, a blockchain analytic firm, believes these transfers via CEX could become critical for law enforcement agencies.
Sean Thornton from Match System told Cointelegraph that they suspect centralized exchanges were used as an intermediate link in the money laundering chain.
“On CEX, funds could be exchanged for other tokens and withdrawn further, and accounts on CEX could be registered for drops (dummy persons). Taking into account the fact that it is almost impossible to trace the movement of funds through CEX without a request from law enforcement agencies, CEX is a more preferable option than DEX for a hacker to gain time and confuse paths,” Thornton explained.
Match System carried out a post-mortem of the SafeMoon smart contract and the subsequent movement of funds to analyze the behavior of the exploiters. The analysis revealed that the hacker exploited a vulnerability in SafeMoon’s contract associated with the “Bridge Burn” feature, allowing anyone to call the “burn” function on SFM tokens at any address. These attackers used the vulnerability to transfer other users’ tokens to the developer’s address.
The transfer made by exploiters resulted in 32 billion SFM tokens being sent from SafeMoon’s LP address to SafeMoon’s deployer address. This led to an instant pump in the value of tokens. The exploiter used the price pump to swap some of the SFM tokens for BNBs at an inflated price. As a result, 27380 BNB were transferred to the hacker’s address.
Match System, in its analysis, found that the smart contract vulnerability was not present in the previous version and only came in with the new update on March 28, the day of the exploit, leading many to believe the involvement of an insider. These speculations gained more fuel by Nov.1 as the SECf iled charges against SafeMoon project and its three executives, accusing them of committing fraud and violating securities laws.
Thornton told Cointelegraph that the SEC accusations are not unfounded and they also found evidence that may indicate the involvement of SafeMoon management in the hacking that occurred. He added that whether this was done intentionally or was the criminal negligence of the employees will have to be sorted out by law enforcement agencies.
Related: New crypto litigation tracker highlights 300 cases from SafeMoon to Pepe the Frog
The SEC alleged that the CEO of SafeMoon, John Karony, and the chief technical officer, Thomas Smith, embezzled investor cash and withdrew $200 million in assets from the enterprise. The SafeMoon executives are also facing charges from the Justice Department for conspiring to commit wire fraud, money laundering, and securities fraud.
The hacker behind the attack initially claimed they had mistakingly exploited the protocol and wanted to set up a communication channel to return 80% of the funds. Since then, the funds linked to the exploits have moved on several occasions, many times via centralized exchanges like Binance, which the analytic firm believes will be critical for law enforcement agencies to track down the perpetrators of the exploit.
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The evolving relationship between Bitcoin and traditional financial markets is under renewed pressure as global investors flee risk assets amid intensifying US trade tensions. US-listed spot Bitcoin (BTC) exchange-traded funds (ETFs) recorded their fourth consecutive day of outflows on April 8, with more than $326 million in net redemptions across products, according to data from Farside Investors. BlackRock’s iShares Bitcoin Trust ETF (IBIT) saw the largest sell-off of over $252 million, its biggest daily outflow since Feb. 26. Bitcoin ETF flows, US dollars, millions. Source: Farside Investors The selling pressure follows US President Donald Trump’s April 2 announcement of sweeping reciprocal import tariffs, which triggered a historic $5 trillion wipeout in the S&P 500 over two days. Related: Bitcoin may rival gold as inflation hedge over next decade — Adam Back The delayed crypto market turbulence after the tariff-related sell-off in traditional markets highlights Bitcoin’s “evolving relationship with traditional markets,” according to Lennix Lai, global chief commercial officer at OKX exchange. Lai told Cointelegraph: “While falling 26% since January’s inauguration, Bitcoin’s relative resilience in the first two days following the tariff announcement — dropping 6% compared to Nasdaq’s 11% decline — suggests a nuanced dynamic emerging between crypto and conventional assets.” Bitcoin initially remained firmly above the $82,000 support level but plummeted below $75,000 on Sunday, April 6. BTC/USD, 1-year chart. Source: Cointelegraph Markets Pro Some industry leaders attributed Sunday’s sell-off to Bitcoin’s 24/7 liquidity mechanics, which made BTC the only large liquid asset available for de-risking over the weekend. Related: Bitcoin price can hit $250K in 2025 if Fed shifts to QE: Arthur Hayes While there is an “encouraging sign” of a weakening correlation between Bitcoin and equities, Bitcoin’s price trajectory remains tied to global liquidity conditions, Lai said, adding: “Though I see early signs of divergence, I believe Bitcoin remains fundamentally tied to global liquidity conditions, warranting caution amid potential market stresses — whilst gold remains as a hedge against geopolitical instability.” “What’s most significant here isn’t just price action but Bitcoin’s growing conceptual influence — people increasingly view it as a valid strategic reserve asset for diversification in chaotic traditional markets,” Lai added. Other analysts also see the growing money supply as Bitcoin’s main catalyst. “Bitcoin trades solely based on the market expectation for the future supply of fiat,” according to Arthur Hayes, co-founder of BitMEX and chief investment officer of Maelstrom. Magazine: Bitcoin ATH sooner than expected? XRP may drop 40%, and more: Hodler’s Digest, March 23 – 29
The European Securities and Markets Authority (ESMA) has warned that crypto will increasingly threaten traditional financial markets’ stability as the industry grows and becomes more entwined with traditional finance players. “We cannot rule out that future sharp drops in crypto prices could have knock-on effects on our financial system,” ESMA’s executive director Natasha Cazenave said in an April 8 statement to the Economic and Monetary Affairs Committee. Cazenave noted, however, that crypto currently only accounts for 1% of global financial assets and is not yet significant enough to cause major “spillover effects” into traditional financial markets. She warned that interconnections between crypto and traditional markets are rapidly growing — particularly in the more crypto-friendly US — and called for closer monitoring. “Crypto-assets markets evolve quickly, in an often unpredictable manner, and we need to keep a close eye on these developments,” Cazenave said, adding: “Turmoil, even in small markets, can originate or catalyze broader stability issues in our financial system.” Cazenave’s concerns ranged from spot crypto exchange-traded funds and stablecoin use to hacks, scams and scandals — highlighting the recent $1.4 billion Bybit exploit and FTX’s collapse in November 2022. Today in the ECON Committee, the role of crypto assets in relation to financial market stability was discussed. The European Central Bank (ECB) and the European Securities and Markets Authority (ESMA) were present. I raised a critical question about the digital euro.… pic.twitter.com/KST7FRBhFF — Engin Eroglu (@EnginEroglu_FW) April 8, 2025 The European Union has already implemented several measures to safeguard against crypto risks, most notably the Markets in Crypto-Assets (MiCA) regulation that was rolled out last year. While Cazenave said MiCA marked a “breakthrough” for crypto regulation, she added that there is “no such thing as a safe crypto-asset” and that more rules may need to be implemented to mitigate future risks. Related: EU could fine Elon Musk’s X $1B over illicit content, disinformation Her comments come as both crypto and the stock markets have experienced double-digit falls over the last few weeks as the Trump administration continues to follow through on its tariff plans. While crypto adoption has accelerated in the US, Cazenave noted that over 95% of European banks remain on the sidelines, with no involvement in crypto-related activities. However, retail participation is on the rise, with an estimated 10% to 20% of European investors having crypto exposure, which is in line with growing global interest, Cazenave said. Most reports measuring US crypto adoption suggest that the range of adoption is between 15% and 28% of the population. Magazine: Financial nihilism in crypto is over — It’s time to dream big again
Former NBA star Shaquille O’Neal has been granted final court approval to settle a class-action lawsuit for $11 million with Astrals non-fungible token (NFT) buyers. Florida federal court judge Federico Moreno granted approval of the settlement between O’Neal and the class group led by Daniel Harper in an April 1 order made available on April 8. The deal created a fund of up to $11 million for eligible class members and awarded $2.9 million in attorney fees and costs. All those who purchased Astrals NFTs from May 2022 to Jan. 15 and those who purchased the project’s native GLXY tokens up until mid-January are eligible. “The fee sought by lead class counsel has been reviewed and approved as fair and reasonable by plaintiffs,” Moreno’s order read. O’Neal was hit with the lawsuit in May 2023 over his founding and promotion of the Solana-based Astrals NFT project, which the suit claimed was an “offer and sale of unregistered securities.” The class group said they bought Astrals NFTs and “suffered investment losses” due to O’Neal’s “conduct” in promoting the project. In August, Judge Moreno recognized that the class suit had alleged that the former NBA player was a seller of the NFTs. O’Neal agreed to the settlement in November. Screenshot from court order on final settlement. Source: Courtlistener The Astrals NFT collection consisted of 10,000 unique 3D digital collectibles created in April 2022 by the artist Damien Guimoneau in a Solana-based project that promoted a virtual world where users could socialize and play with others, including the basketball star. Related: NFT sales plunge 63% in Q1, but Pudgy Penguins, Doodles buck trend There has been no activity or sales from the collection for the past two years, according to NFT marketplace OpenSea. Overall, NFT sales are still in deep bear market territory, with just $27 million sold as of April 7, down from more than $2 billion per week at the end of 2021, according to CryptoSlam. Magazine: 3 reasons Ethereum could turn a corner: Kain Warwick, X Hall of Flame
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Bitcoin remains tied to global liquidity conditions
Europe lags US in crypto adoption
NFT sales slump
