BlockTower Capital’s Hedge Fund Allegedly  Breached in Hack

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As a seasoned crypto investor with several years of experience under my belt, I can’t help but feel a sense of disappointment and unease upon hearing about the hack that hit BlockTower Capital. I’ve seen my fair share of ups and downs in this space, and while I understand that risks come with rewards, this news is particularly disheartening.

Scammers have managed to infiltrate and substantially drain BlockTower Capital’s main hedge fund, causing a major issue for this digital asset investment firm.

As a researcher, I’ve come across Bloomberg’s report that a company, after discovering a theft of funds, informed its limited partners about the incident. In response, they brought on board blockchain forensics analysts to delve into the investigation and trace the path of how the money was pilfered. Regrettably, despite these efforts, the stolen funds remain unaccounted for and the hacker remains at large.

According to data from PitchBook, the company manages a total of $1.7 billion in assets. Yet, there is no clarity on how much of that fund has been affected or breached by any means.

I started investing with BlockTower back in 2017, and what drew me in was their presence not just in New York but also in Miami. They’ve made some impressive moves in the crypto world by investing in companies like Dapper Labs, the innovative non-fungible token developer. I’m particularly excited about Sky Mavis, the gaming studio they’ve backed. And let’s not forget Terraform Labs, creators of TerraUSD – although their stablecoin project didn’t quite take off as planned.

Prior to the recent hack, BlockTower encountered challenges. They shut down their “market-neutral” digital currency fund from the previous year, which previously handled more than $100 million in assets, due to dwindling investment prospects for that strategy.

As a crypto investor, I’ve noticed an unfortunate trend in the past year: the number of scams and hacks targeting retail investors like myself has risen, even though the total amount of money stolen in 2023 was less than in 2022. Specifically, there were 219 reported hacking incidents in 2022, which unfortunately increased to 231 in 2023. This means that while the overall financial damage may have been slightly less last year, the number of individual instances of theft has gone up. It’s a concerning development that we as investors need to be vigilant against.

As a researcher studying the cryptocurrency landscape, I can assert that TRM Labs’ findings reveal a significant issue: hacking incidents continue to pose a substantial threat to the digital asset community, costing an estimated $1.7 billion from various projects within the past year.

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2024-05-15 11:32