Another day in crypto paradise

We have a news saturated night to dissect. The aim of today's Morning Note is to provide some colour and perspective on what is happening in crypto land.

The information contained here is for general information only. It should not be taken as constituting financial advice. Stormrake is not a financial adviser. You should consider seeking independent financial advice prior to making any personal investments.

Heavy hitter first

The RBA has raised rates for the fourth consecutive month and lifted rates by 50 bps taking the cash rate to 1.85% with a highly likely 50 bps shot to be delivered next meeting.

Australian Bureau of Statistics’ data released on Wednesday reveals transport costs jumped 13.1% as fuel prices soared, while fruit and vegetable prices rose almost 6% in the June quarter. The cost of new houses also rose 9% from a year earlier.

This squeeze on household budgets from rising energy, food, transport and housing costs means that there is very little left over for capital investment and whether that be crypto, stocks or commodity assets, the demand side destruction from inflation and rising cost of money will temper asset prices for some time to come.

Bridge hacks for supper

After a few quiet months without any calamitous crypto hacks, it’s happened again: another blockchain bridge hack with losses in the hundreds of millions of dollars was doled out to Defi denizens.

Nomad, a cryptocurrency bridge that lets users swap tokens between blockchains, is the latest to be hit after a frenzied attack on Monday, which left almost $200 million of its funds drained.

The hack was acknowledged by the Nomad project’s official Twitter account on Monday, August 1st, initially as an “incident” that was being investigated. In a further statement released early Tuesday morning, Nomad said that the team was “working around the clock to address the situation” and had also notified law enforcement.

Pictured below is what the hack looked like on-chain without having to use busy infographics.

Breaking news: Solana ecosystem compromised

Widespread Solana private key compromise:

- attacker is stealing both native tokens (SOL) and SPL tokens (USDC)

- targeting wallets that have been inactive for >6 months

- both Phantom & Slope wallets reportedly drained

Exploit cause unknown, might be an upstream dependency supply chain attack Revoking approvals will probably not help - only transferring to an offline hardware wallet will save funds from being drained.

Stormrake is pleased to say there is no impact nor risk to client funds due to our stringent risk management and use of distributed cold storage.

MicroStrategy CEO, Michael Saylor steps down

MicroStrategy Inc. co-founder Michael Saylor gave up his chief executive officer title and said he’ll focus more on Bitcoin after the enterprise-software maker reported a loss of more than $1 billion related to the second-quarter plunge in the price of the cryptocurrency.

This will be an interesting development in the MSTR - BTC story as Saylor will stay on as an exec chairman effectively providing key stakeholder control, there is the need to be aware of the interim risk of the company being one of the largest holders of BTC could have its executive team divided over its balance sheet strategy.

Not all doom and gloom

Despite a whirlwind of events having the crypto ecosystem reeling from hacks, wallet drains and perceived messiahs stepping down from prominent positions the Bitcoin blockchain continues to produce blocks, validate transactions, and provide an alternative financial ecosystem to opt-in to for those experiencing their local fiat currency being inflated away.

Disclaimer

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