- Post-hack, XRP’s CVD plummeted, signaling a massive sell-off of nearly 100M tokens, mainly on Binance and OKX, raising security concerns.
- ZachXBT’s hack revelation led to a market shift, with significant BTC withdrawals linked to the stolen XRP totaling $73.3M.
- The Ripple co-founder’s wallet hack underscores the critical need for enhanced security and transparency in the cryptocurrency market.
Following a cybersecurity breach that affected Ripple’s co-founder, Chris Larsen, the cryptocurrency market saw a notable downturn in the trading of XRP tokens. The market analytics provider Kaiko unveiled data highlighting a considerable drop in the Cumulative Volume Delta (CVD) for XRP.
This metric gauges the aggregated buy and sell activities on cryptocurrency exchanges, underscoring a stark sell-off, predominantly on Binance and OKX. The sell-off, involving nearly 100 million XRP tokens, may have been in part triggered by the hack and prompted widespread concern regarding the safety of digital assets within the crypto ecosystem.
The decline in XRP’s CVD became particularly evident after January 30, when the asset initially showed a positive buying trend, with over 20 million tokens purchased on Binance alone. Despite this influx of buying interest, XRP’s value fell by 4.58% the same day, attributed to the broader market’s volatility. The situation took a turn for the worse as details of the hack came to light, with trading patterns showing a drastic shift from net buying to net selling, especially on Binance and OKX.
The breach was first brought into the public eye by on-chain investigator ZachXBT. It involved Larsen’s wallet and led to the misidentification of the compromised wallet as belonging to Ripple.
This revelation prompted a flurry of sell-offs as traders and investors rushed to liquidate their XRP holdings amidt growing uncertainty. ZachXBT further exposed that the stolen assets were dispersed across several exchanges and converted into different cryptocurrencies, contributing to the downward pressure on XRP’s trading metrics.
Despite attempts to stabilize the situation, with Binance freezing $4.2 million in XRP linked to the hack, most of the stolen tokens had already been sold. ZachXBT’s further investigations revealed significant Bitcoin withdrawals from exchanges, amounting to $73.3 million, which were likely derived from the sale of the pilfered XRP.
These movements, including substantial withdrawals from HTX, Gate.io, and Kraken, highlighted the far-reaching impact of the hack, extending beyond Ripple and its co-founder to the broader cryptocurrency market.
The event underscores the ongoing challenges and risks associated with digital asset security and the swift market reactions to breaches of trust within the cryptocurrency sector. The need for robust security measures and transparent communication becomes increasingly apparent as the community grapples with these issues.
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