SOL

Bitcoin may hit $50K on altcoin ‘FUD’ as Ethereum, Solana beat gains

Bitcoin takes a back seat on low timeframes as ETH and SOL claw back crypto market cap share from BTC.

Bitcoin (BTC) struggled to hold above $43,000 into Dec. 8 as an altcoin surge put Ether (ETH) in the spotlight.

Data from Cointelegraph Markets Pro and TradingView showed ongoing BTC price consolidation as ETH/USD added up to 7.6% in around 24 hours.

Bitcoin, having tapped new 19-month highs of $44,490 earlier in the week, now troubled market participants as both ETH and Solana (SOL) stole attention.

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Polygonscan went down, causing unwarranted concern of blockchain outage

Data from PolygonScan showed that the blockchain had not produced any new blocks or processed transactions for some time, leading some to believe it was suffering an outage.

Update: The article was updated at 11:45pm UTC on Feb. 22 to reflect that the blockchain explorer Polygonscan was not updating correctly. Polygon has continued to produce blocks, according to OKLINK.

An outage at network explorer Polygonscan led to unfounded speculation that the Polygon blockchain was temporarily down for the count. 

Rumors surfaced on Feb. 22 that layer-2 scaling solution Polygon may have been suffering an outage after data from PolygonScan purportedly showed the blockchain had not processed a block in over an hour and a half.

The team at Polygon has since clarified that the issue came from “a few nodes” falling out of sync and that blockchain production has not stopped.

“About 8:26 UTC, a few nodes went out of sync. This caused a reaction where some nodes could not validate blocks for a very brief period of time,” a Polygon spokesperson told Cointelegraph.

“Block production never stopped – However, there could have been a degradation in network performance temporarily. These nodes have resynced and systems are back to normal.”

The spokesperson said the team was also aware that Polygonscan is down, but alternative explorers can be used.

“We are working with Polygonscan to bring them back up,” said the spokesperson.

Speculation of a possible outage first emerged on Feb. 22, with some pointing to an apparent halt in block production based on data from Polyscan — which showed the blockchain’s last block and transaction was processed at around 8:35 pm UTC on Feb. 22.

Latest blocks and transactions on Polygon. Source: Polygonscan

The network has previously suffered network outages, with the last occurring on March 11, 2022, due to maintenance required on one of the network’s three layers.

Polygon Labs, the crypto firm behind the Polygon blockchain, announced on Feb. 21 that it was letting go 20% of its workforce, or approximately 100 positions.

Magic Eden to refund users after 25 fake NFTs sold due to exploit

Over two dozen fake NFTs were sold on the Magic Eden marketplace over a 24-hour period due to a “massive exploit” on the platform.

Nonfungible token (NFT) marketplace Magic Eden has pledged to refund all users who were duped into purchasing fake NFTs on its website as a result of an exploit.

In a Jan. 4 statement, the company said a bug in its newly deployed “activity indexer” for its Snappy Marketplace and Pro Trade tools essentially allowed fake NFTs to skirt verification and get listed alongside genuine NFT collections. 

Magic Eden said the exploit led to 25 fraudulent NFTs sold across four collections in the last 24 hours but is currently confirming whether additional NFTs were affected beyond the last day.

Two of the affected projects were the high-priced and popular Solana-based collections ABC and y00ts.

The NFT platform said it has rectified the issue by temporarily disabling both tools and eliminating the “entry points” that allowed unverified NFTs to get through.

It also asked users to perform a “hard refresh” to ensure the unverified listings no longer show up on their browser session and shut down the purchase of unverified NFTs as a precaution.

“Magic Eden is safe for trading and we will refund all the users who mistakenly bought unverified NFTs specifically due to this issue,” it wrote.

Magic Eden first raised the alarm over the fraudulent NFTs in a Twitter post on Jan. 4, citing community reports that people were able to buy fake ABC NFTs. At the time, it said it added “verification layers” in an attempt to resolve the issue.

After the announcement, Twitter users continued to sound the alarm on fake y00ts NFTs pervading the platform. A screenshot from ABC creator “HGE” showed at least two sales worth 100 Solana (SOL) each, a total amount of around $2,600.

DeGods, the creator of y00ts, also tweeted to its followers that there was an exploit on Magic Eden that allowed unverified NFTs to be listed as part of the collection.

The latest exploit is now the second incident that users of Magic Eden has had to go through this week.

On Jan. 3, the marketplace was littered with pornographic images and images from the television series The Big Bang Theory.

Related: ​​NFT influencer falls victim to cyberattack, loses $300K+ CryptoPunks

Magic Eden said a third-party image hosting provider was “compromised” leading to the “unsavory images” and assured users their NFTs were safe.

Cointelegraph contacted Magic Eden for comment but did not immediately receive a response.

Solana joins ranks of FTT, LUNA with SOL price down 97% from peak — Is a rebound possible?

SOL price jumped 20% after falling to its worst level since February 2021 with Solana’s technicals suggesting that more upside is possible.

Solana (SOL), the cryptocurrency once supported by Sam Bankman-Fried, pared some losses on Dec. 30, a day after falling to its lowest level since February 2021.

Solana price down 97% from November 2021 peak 

On the daily chart, SOL’s price rebounded to around $10.25, up over 20% from its previous day’s low of approximately $8. 

SOL/USD weekly price chart. Source: TradingView

Nevertheless, the intraday recovery did little to offset the overall bear trend — down 97% from its record peak of $267.50 in November 2021, and down over 20% in the past week. 

But while the year has been brutal for markets, Solana now joins the ranks of the worst-performing tokens of 2022, namely FTX Token and LUNA, which are down around 98%. 

FTT (red) vs. LUNA (green) vs. SOL (blue) performance since November 2021. Source: TradingView

SOL price could recover 50%

However, the latest Solana price rebound hints at the possibility of more upside heading into 2023.

That is primarily due to Doji — a candlestick pattern that forms when the asset opens and closes near or at the same level in a specific timeframe. SOL formed what appeared to be a “standard Doji” on its daily chart on Dec. 29.

Traditional analysts consider a Doji as a potential reversal candlestick pattern, given it shows that bears and bulls are at a a stalemate. Therefore, from a technical perspective, a Doji formation during a long uptrend period could suggest a bearish reversal in the making, and vice versa.

SOL’s Doji has appeared after a long downtrend period, as shown in the daily chart below. That, coupled with the token’s oversold (relative strength index reading, suggests that an extended bullish reversal may happen in 2023.

SOL/USD daily price chart featuring Doji candlestick pattern. Source: TradingView

SOL’s primary upside target looks to be around $15, up over 50% from current price levels. The $15 level has served as resistance since Nov. 13, 2022. 

Battling negative fundamentals

Solana has emerged as one of 2022’s worst-performing cryptocurrencies, with its year-to-date losses near 97%. In comparison, the total cryptocurrency market cap has dropped onl 65% in the same period.

Related: ‘Everything bubble’ bursts: Worst year for US stocks and bonds since 1932

Several reasons could explain SOL’s underperformance in 2022 such as a hawkish Fed, Solana’s recurrent downtimes, a $200 million hack on one of its associated wallets, and probable FTX exposure.

Earlier in December, Anatoly Yakovenko, the co-founder of Solana Labs Inc., clarified that nearly 80% of projects on Solana’s blockchain had no exposure at all to FTX, stating that there’s more to their platform than the defunct crypto exchange.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.

Magic Eden follows OpenSea with NFT royalty enforcement tool

The open-source Open Creator Protocol of the NFT marketplace will enforce NFT creator royalties for new collections that opt-in to the tool.

Magic Eden, a Solana-based nonfungible token (NFT) marketplace, has become the latest platform to release a tool allowing creators to enforce royalties on their collections.

It follows the announcement of a similar tool from rival NFT marketplace OpenSea in early November.

According to a Dec. 1 statement, the open-source royalty enforcement tool is built on top of Solana’s SPL token standard and is called the Open Creator Protocol (OCP). This will allow royalty enforcement for new collections that opt-in to the standard starting Dec. 2.

Lu previously floated the idea of NFTs designed to enforce royalties at Solana’s Breakpoint 2022 conference on Nov. 5, citing the need for NFT creators to have a “sustained revenue model.”

Creators who use OCP will also be able to ban marketplaces that have not enforced royalties on their collections. Magic Eden will still maintain optional royalties on its platform for collections that do not adopt OCP.

In a Dec. 1 Twitter thread, Magic Eden said it “can’t retroactively apply OCP to existing collections,” telling creators they will have to conduct “burn [and] re-mints” where the NFTs are sent to an unrecoverable wallet address and re-issued by the collection.

“We have been in active conversations with multiple ecosystem partners to identify solutions for creators in a timely manner,” Lu said in the statement. He added the marketplace’s intention with OCP was to “immediately support royalties” for new collections while it coordinates with other partners for more solutions.

Related: Coinbase claims Apple blocked wallet app release over gas fees

An additional feature of the protocol touted by Magic Eden is the ability for creators to introduce dynamic royalties — that could reduce the value of royalties of buyers who pay higher prices — and customizable token transferability, which could see, for example, NFTs limited to a number of trades or be subject to a trade freeze for a set period of time.

Magic Eden moved to an optional royalties model in October allowing buyers the option to set the royalties they wish to contribute to projects, which split opinions in Twitter’s NFT community.

The OCP tool follows a similar on-chain tool launched in early November by OpenSea that restricted NFT sales to only marketplaces enforcing royalties.

Magic Eden created a similar royalty enforcement tool, MetaShield, in partnership with peer marketplace and aggregator Coral Cube in September before its move to optional royalties.

Not just FTX Token: Solana price nukes 40% along with other ‘Sam coins’

Cryptocurrencies exposed to Sam Bankman-Fried and his companies, Alameda Research and FTX, have dropped by an average of 40% this week.

Solana (SOL) is on the track to log its worst daily performance on record.

On Nov. 9, SOL’s price dropped more than 40% to around $16 primarily due to its association with Sam Bankman-Fried, the founder of crypto-focused hedge fund Alameda Research and cryptocurrency exchange FTX.

SOL/USD daily price chart. Source: TradingView

Sam tokens get ‘fried’

Fried was an early investor in the Solana blockchain project via Alameda Research. On Nov. 8, the entrepreneur’s estimated wealth plunged from a whopping $15.6 billion to around $1 billion, according to Bloomberg Billionaires Index.

At the core of this wipeout was a near-collapse of FTX. On Nov. 6, Binance, FTX’s rival exchange and early investor, decided to sell its $2 billion stake, which it was holding in the form of FTX’s native token, FTX Token (FTT). In response, FTT’s price crashed by over 85% and was trading for around $3.60 as of Nov. 9.

Alameda Research’s balance sheet reportedly was worth around $12 billion as of June 30, out of which half was FTT. The firm allegedly had $8 billion in liabilities on the same day, raising speculation about its potential insolvency after FTT’s massive crash.

As a result, this has increased downward pressure on cryptocurrencies with exposure to Alameda Research, FTX and Bankman-Fried, or so-called “Sam coins.”

Related: Alameda on the radar of BitDAO community for alleged dump of BIT tokens

SOL’s price has plunged by more than 55% since Binance decided to dump its FTT reserves. Similarly, Serum (SRM), a decentralized exchange asset functioning atop the Solana blockchain, crashed by 55% in the same period.

SRM/USD daily price chart. Source: TradingView

Ren, a decentralized custodian project, also witnessed a 33% drop in the valuation of its native token, REN, after Binance’s announcement of intent to sell FTT.

Overall, Sam tokens, including Raydium (RAY), Bonfida (FIDA) and Maps (MAPS), have dropped by an average of 40% since Nov. 6.

Still hope for Solana?

Meanwhile,18.77 million SOL tokens, or around $330 million at the time of writing, will be unstaked and enter circulation on Nov. 10, according to lending data collected by Lookonchain. This may further put downward pressure on SOL’s price.

From a technical perspective, SOL could drop toward $14.30 after entering the breakdown stage of its descending triangle pattern, as shown in the chart below. In other words, a 25% plunge from current prices.

SOL/USD daily price chart. Source: TradingView

Conversely, the Solana token’s daily relative strength index has dropped below 30, or “oversold,” which hints at a potential sideways consolidation or short-term price bounce toward the triangle’s lower trendline at $30 in the coming days.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Solana’s co-founder addresses the blockchain’s reliability at Breakpoint

In 2022, the blockchain suffered from ten partial or full outages along with slow block times. Solana’s co-founder said it’s “not the experience that we want to deliver.”

Solana co-founder Anatoly Yakovenko says the past year has been mired by the network’s reliability issues and outages, but recent updates will help the blockchain resolve its reliability issues. 

During the Breakpoint 2022 annual conference in Lisbon, Portugal on Nov. 5,  Yakovenko discussed the past and future of the blockchain, noting the network has faced difficulties over the past year:

“We’ve had a lot of challenges over the last year, I would say this whole last year has been all about reliability.”

Solana has suffered ten partial or full outages, according to its own status reporting, the most notable of which occurred between Jan. 6-12, 2022, with the network plagued with issues causing partial outages and degraded performance for between 8 and 18 hours. The most recent was what it called a “major outage,” lasting nearly six and a half hours on Oct. 1.

Between late May and early June, Solana suffered from a clock drift, where the blockchain’s time was different from real-world time due to longer than average slot times (also referred to as block times), the time interval during which a validator can send a block to Solana.

Typically, Solana’s ideal slot time is 400 milliseconds, but Yakovenko said that “things got really really bad in June, block times went up to over a second, which is really slow for Solana,” adding in some cases “confirmation times so we’re taking 15 to 20 seconds:”

“That’s not the experience that we want to deliver and that’s a pretty bad Web2 experience when you’re competing with Google with Facebook with all these other applications.”

Yakovenko said after a recent update and the validator count doubling in the past year puts Solana on the path to resolving the network performance issues and added:

“[We’re] in a constant fight between performance, security, throughput, and decentralization, all of these problems […] whenever you improve one you may actually hurt some of the other ones but I think we’ve done an amazing job in solving a bunch of those.”

“Obviously we still have challenges with outages and bugs,” he said, but its August partnership with Web3 development firm Jump Crypto to build Solana’s scaling solution called Firedancer — dubbed the long-term fix to the network outage problem — could hold the key.

Related: Solana unveils Google partnership, smartphones, Web3 store at Breakpoint

“Having a second implementation and a second client built by a different team with a fully separate code base, the probability of the same kind of bug existing in both is virtually zero.”

Ongoing Solana-based wallet hack has already seen millions drained

NFT marketplace Magic Eden noted that it “seems to be a widespread SOL exploit at play” and called on users to revoke permissions for any suspicious links in their Phantom wallets.

A security vulnerability impacting the Solana ecosystem has reportedly seen millions in funds drained across a number of Solana-based wallets.

At the time of writing, Solana (SOL) is currently trending on Twitter as countless users are either reporting on the hack as it unfolds, or are reporting to have lost funds themselves, warning anyone with Solana-based hot wallets such as Phantom and Slope wallets to move their funds into cold wallets.

So far both Phantom, Slope, and Magic Eden are among those that have commented on the issue, with wallet provider Phantom noting that it is working with other teams to get to the bottom of the issue, although it says it does not “believe this is a Phantom-specific issue” at this stage.

Magic Eden confirmed the reports by stating that “seems to be a widespread SOL exploit at play that’s draining wallets throughout the ecosystem” as it called on users to revoke permissions for any suspicious links in their Phantom wallets.

Slope said it is currently working with Solana Labs and other Solana-based protocols to pinpoint the issue and rectify it, though there were “no major breakthroughs yet.”

Twitter user @nftpeasant has been following the incident closely, and according to their research via Solscan, around $6 million worth of funds have already been siphoned from Phantom wallets during a 10-minute period on August 2. In one instance it appears a Phantom wallet user had $500,000 worth of USDC drained from their account.

Popular scam detective and self-described “on-chain sleuth” @zachxbt also did some digging and revealed to their 274,800 followers that the hackers initially funded the primary wallet associated with this attack via Binance seven months ago.

Related: Solana-based stablecoin NIRV drops 85% following $3.5M exploit

The transaction history shows that the wallet remained dormant until today before the hackers conducted transactions with four different wallets 10 minutes before the attack started.

There have also been different reports on how many wallets have been affected and the extent of the damage so far.

Crypto tracking and compliance platform Mist Track stated via Twitter that as many as 8,000 wallets have been hacked, with $580 million sent to four addresses, however, comments on the post are skeptical about the number.

Meanwhile, Ava Labs CEO and founder Emin Gun Sirer stated that the number was at 7,000 plus wallets, a number which is rising at around 20 per minute. He said he believes that as the transactions appear to be signed properly, “it is likely that the attacker has acquired access to private keys.”

Cointelegraph has reached out to Phantom for comment on the matter and will update the story if the firm responds.

Ongoing Solana-based wallet hack seeing millions drained

NFT marketplace Magic Eden noted that it “seems to be a widespread SOL exploit at play” and called on users to revoke permissions for any suspicious links in their Phantom wallets.

An ongoing, widespread hack has seen as much as $8 million in funds drained so far across a number of Solana-based hot wallets.

At the time of writing, Solana (SOL) is currently trending on Twitter as countless users are either reporting on the hack as it unfolds, or are reporting to have lost funds themselves, warning anyone with Solana-based hot wallets such as Phantom and Slope wallets to move their funds into cold wallets.

Blockchain investigator PeckShield on August 2 said the widespread hack is likely due to a “supply chain issue” which has been exploited to steal user private keys behind affected wallets. It said the estimated loss so far is around $8 million. 

Solana-based wallets providers including Phantom and Slope, and non-fungible token (NFT) marketplace Magic Eden are among those that have commented on the issue, with wallet provider Phantom noting that it is working with other teams to get to the bottom of the issue, although it says it does not “believe this is a Phantom-specific issue” at this stage.

Magic Eden confirmed the reports earlier in the day by stating that “seems to be a widespread SOL exploit at play that’s draining wallets throughout the ecosystem” as it called on users to revoke permissions for any suspicious links in their Phantom wallets.

Slope said it is currently working with Solana Labs and other Solana-based protocols to pinpoint the issue and rectify it, though there were “no major breakthroughs yet.”

Twitter user @nftpeasant said as much as $6 million worth of funds were siphoned from Phantom wallets during a 10-minute period on August 2. In one instance it appears a Phantom wallet user had $500,000 worth of USDC drained from their account.

Popular scam detective and self-described “on-chain sleuth” @zachxbt also did some digging and revealed to their 274,800 followers that the hackers initially funded the primary wallet associated with this attack via Binance seven months ago.

Related: Solana-based stablecoin NIRV drops 85% following $3.5M exploit

The transaction history shows that the wallet remained dormant until today before the hackers conducted transactions with four different wallets 10 minutes before the attack started.

There have also been different reports on how many wallets have been affected and the extent of the damage so far.

Crypto tracking and compliance platform Mist Track stated via Twitter that as many as 8,000 wallets have been hacked, with $580 million sent to four addresses, however, commentators on the post are skeptical about the number.

Meanwhile, Ava Labs CEO and founder Emin Gun Sirer stated that the number was at 7,000 plus wallets, a number which is rising at around 20 per minute. He said he believes that as the transactions appear to be signed properly, “it is likely that the attacker has acquired access to private keys.”

Cointelegraph has reached out to Phantom for comment on the matter and will update the story if the firm responds.

Class action lawsuit claims Solana’s SOL is an unregistered security

Plaintiffs claim that Solana’s SOL token is a centralized security with insiders profiting immensely while retail traders got rekt.

Solana Labs is the latest crypto company to be hit with a lawsuit accusing it of promoting an unregistered security.

The class action was filed on July 1 by Roche Freedman LLP and Schneider Wallace Cottrell Konecky in the district court for the northern district of California on behalf of plaintiff Mark Young, a state resident.

The lawsuit accuses Solana Labs, the Solana Foundation, Anatoly Yakovenko, Multicoin Capital Management, Kyle Samani and FalconX of selling unregistered securities tokens in the form of Solana (SOL) from March 24, 2020:

“Defendants made enormous profits through the sale of SOL securities to retail investors in the United States in violation of the registration provisions of federal and state securities laws, and the investors have suffered enormous losses,”

The plaintiff is taking action on behalf of himself and other SOL investors with further claims that Solana Labs “deliberately misleading statements” concerning the total circulating supply of SOL tokens.

According to the lawsuit, Solana Labs founder Anatoly Yakovenko lent a market maker more than 11.3 million tokens in April 2020 and failed to disclose this information to the public. The company stated it would reduce the supply by this amount but only burned 3.3 million tokens, the lawsuit claims.

The plaintiffs also took umbrage with Solana’s claims of being decentralized. “As of May 2021, insiders held 48% of the SOL supply. The network is thus highly centralized,” it added.

The lawsuit’s outcome could have significant implications for Solana and the broader crypto industry. SOL may be delisted from leading crypto exchanges if it is deemed to be a security by a court. Coinbase and Kraken delisted Ripple (XRP) in late 2020 following the SEC’s lawsuit against Ripple, which is soon to be concluded.

Related: Reliably unreliable: Solana price dives after latest network outage

The suit comes on top of Solana’s ongoing reliability woes, with the network having suffered at least seven full or partial outages over the past 12 months. These outages were mentioned in the filing with claims they resulted in “major losses for network users,” as they caused the trading value of SOL to fall dramatically.

SOL prices have tanked 85% from their November 6 all-time high of $260 and are currently trading at a little under $40, according to CoinGecko.

Solana Labs and Multicoin Capital were contacted for comment but had not responded by the time of publication.