Whale of Fortune 🎰

Thursday has arrived! I’m Juan Aranovich, managing editor of Unchained.

In today’s edition:

• 🐳 Smart-staking whale takes Chainlink profits

• 🔥 Virtuals’ burn plan buoys ecosystem

• 🌍 Jupiter’s big airdrop

• 🚀 Bitcoin’s macro boost

• 🛡️ U.S. returns Bitfinex’s stolen BTC

• ⚖️ BitMEX faces AML, KYC bill

• 🔍 SEC appeals XRP ruling

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What’s Poppin’?

By Sage D. Young and Tikta

Chainlink Whale Starts Cashing Out to Binance

In 2022, blockchain project Chainlink rolled out new functionality allowing crypto investors to stake the project’s tokens — letting users lock them up in exchange for rewards. In an effort to assure broad participation, Chainlink initially imposed a 7,000-token limit for each wallet.

But one clever trader managed to circumvent that limit by creating more than 100 wallet addresses to stake over 1 million LINK tokens, which are worth more than $20 million at their current price.

Now, that trader, who has been identified as the pseudonymous user “Oldwhite” on the OpenSea platform, appears to be moving to unwind some of their positions to Binance at a substantial profit, in some ways validating the hydra-headed wallet strategy and underscoring the difficulty projects sometimes face in trying to enforce such limits, however worthy their intentions.

Virtuals Ecosystem Sees Boost on Buyback-and-Burn Program

Virtuals Protocol, a tooling platform that enables people to create artificial intelligence agents, has seen a price jump in numerous cryptocurrencies native to its ecosystem following the unveiling of details of the protocol’s buyback-and-burn program.

The price of VIRTUAL had increased more than 27% in the 24 hours before press time to trade at $3.74, giving the cryptocurrency a market capitalization of more than $3.7 billion, data from CoinGecko show.

Meanwhile, two of the top AI agent coins on Virtuals by market cap — AIXBT and GAME — had increased 40% and 39%, respectively, in the 24 hours to press time. LUNA was up 27%, while VADER had risen a more modest 4%.

Virtuals’ entire ecosystem, which is built on Coinbase-incubated layer 2 Base, has a market cap of roughly $6 billion.

Jupiter to Airdrop $575M of JUP

Crypto users of Jupiter, a decentralized exchange aggregator on the Solana blockchain, are about to receive free money.

On Wednesday, Jupiter contributors announced that the protocol’s second airdrop is expected to occur next week before its Jan. 25-26 “Catstanbul” conference in Istanbul. @MessiasMorten, who is part of Jupiter DAO’s core working group, said on the protocol’s Discord that an exact claim date has yet to be announced.

Out of 700 million JUP tokens worth about $575 million allocated for the airdrop, 440 million have been earmarked for users, 60 million are for stakers, and the remaining tokens will be used as “carrots” — growth campaigns to bring more users to the onchain swapping venue.

Bitcoin Rallies Past $100,000 as U.S. Inflation Eases

Bitcoin rallied to an intraday high of $100,781 on Wednesday after markets reacted positively to a lower-than-expected consumer price index number.

The U.S. core CPI fell to 3.2%, below the expected 3.3%, slightly increasing bets on a March interest rate cut by the Federal Reserve.

The data had a favorable effect on most risk assets, with the three main U.S. indices ending higher and the S&P 500 boasting 20 new 52-week highs.

Bitcoin’s positive price action had a negative impact on some crypto traders, with $210 million of short positions liquidated during the 24 hours up to the time of writing, according to data from CoinGlass.

U.S. to Return $9B of Stolen BTC to Bitfinex

The U.S. Department of Justice has determined that crypto exchange Bitfinex is the rightful owner of funds recovered following a hack in August 2016 in which nearly 120,000 BTC, valued at about $70 million at the time, was stolen.

In a motion submitted to the U.S. District Court for the District of Columbia on Jan. 14, government attorneys called for a voluntary restitution of 94,643 BTC, worth more than $9 billion, to Bitfinex.

The funds were recovered from Ilya Lichtenstein and his wife, Heather Morgan, both of whom were arrested and convicted in 2022.

The recovered funds represent the coins left in the hackers’ wallet, while 25,000 BTC was withdrawn by Lichtenstein years ago and laundered using various methods.

“Because of the complexity of the laundering transactions, these remaining assets cannot be characterized as ‘the specific property lost’ by Bitfinex and/or its accountholders,” the filing read.

BitMEX Fined Another $100M for AML, KYC Failures

Crypto exchange BitMEX has been ordered to pay an additional $100 million for violating the U.S.’s Bank Secrecy Act by failing to implement anti-money laundering and know-your-customer programs.

The act requires financial institutions to assist U.S. government agencies in detecting and preventing money laundering.

The settlement resolves a legal battle that began in October 2020, when U.S. authorities filed civil and criminal charges against the company and its founders.

BitMEX said it was “disappointed to learn of the imposition of an additional financial penalty,” but noted that the amount was “substantially less” than the $420 million the U.S. Department of Justice had originally sought three years ago.

SEC Petitions Appeals Court to Overturn Initial XRP Ruling

The U.S. Securities and Exchange Commission filed an opening brief appealing a previous court ruling that found Ripple-issued XRP was not classified as a security when it was sold to retail investors.

In 2023, Judge Analisa Torres determined that XRP was a security when it was sold to institutions but not when it was sold to retail investors through exchanges.

The SEC wants the Second Circuit Appeals Court to rule that a New York district court was wrong to rule that both institutional and retail XRP sales qualified as investment contracts under the Howey test, which determines what assets are investment contracts, potentially subjecting them to U.S. securities laws.

“As expected, the SEC’s appeal brief is a rehash of already failed arguments — and likely to be abandoned by the next administration,” Ripple’s chief legal officer, Stuart Alderoty, wrote on X.

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Daily Bits… ✍️✍️✍

• ⚖️ Pump.fun faces a potential lawsuit as U.S. law firm Burwick Law calls for investors to step forward, alleging that the Solana-based launchpad enabled harmful content and collected hundreds of millions in fees.

• 💻 VanEck filed for an Onchain Economy ETF, aiming to invest 80% of its assets in digital asset-focused companies, including exchanges, crypto payment platforms, and mining firms.

• 🇺🇸 The incoming Trump administration’s SEC leadership is reportedly preparing to overhaul crypto regulations, focusing on clarifying securities laws and halting ongoing enforcement actions.

• 🤖 Eliza Wakes Up opened pre-orders for a $420,000 humanoid AI robot, blending advanced robotics, AI, and blockchain to deliver lifelike emotional intelligence and personalized companionship.

• ⏱️ Pyth Network launched Lazer, a low-latency oracle offering millisecond price feeds for applications such as high-frequency trading, enhancing DeFi performance across EVM and Solana.

Today in Crypto Adoption...

• 📶 Indian telecom giant Jio partnered with Polygon Labs to introduce Web3 capabilities to over 450 million users, accelerating blockchain adoption in India.

What Do You Meme?

📈 Your Market Update 📉

• BTC is up 2.3%, trading at $99,334

• ETH is up 4.7%, trading at $3,356

• BTC dominance: 53.8%

• Crypto market cap: $3.66T

*All data as of today, 07:58 am ET. Source: CoinGecko

Recommended Reads

1. IBC: The State of Cross-Chain Interoperability In 2024

2. Blockworks: US equities pare recent losses after mixed inflation print

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