BingX Hack, HMSTR Airdrop Drama and more.

This week has brought turmoil and growth in the crypto space. A $42 million hack on BingX has rocked the market, raising questions about security vulnerabilities at major exchanges. Meanwhile, Hamster Kombat's controversial airdrop sparked outrage after millions of players were denied tokens.

These developments highlight the industry's prospects and threats as it continues to evolve and attract the attention of regulators and innovators alike.

BingX restores services after $42 million crypto hack

On September 20, crypto exchange BingX was hacked. This incident resulted in a loss of over $42 million in digital assets.

The breach initially revealed a total of $13.6 million in suspicious transactions. Upon further investigation, the losses rose to $26 million, eventually totaling $42 million.

Read more: Crypto Project Security: A Guide to Early Risk Detection

The stolen assets included a wide range of cryptocurrencies, notably 4.44 million USDT ($4.4 million), 1 million WUSD ($1 million), 608,660 USDC ($608,660) and 9.38 BTCB ($590,000). PeckShield and other security experts said the attackers transferred the money to a wallet address named ‘0xF7e8'. On-chain data shows that these bad actors quickly exchange stolen assets for Ethereum (ETH) and BNB.

Despite the huge losses, BingX Chief Product Officer Vivian Lin assured consumers that the company will cover the entire amount with capital reserves.

“Our technical team found unusual network access, hacker attack on BingX hot wallet. We immediately initiated our emergency plan, including an immediate asset transfer and freeze. A small property loss has occurred, but the amount is small and still being calculated,” Lin wrote on X (Twitter).

Following this incident, BingX continued its services. Withdrawals for major assets such as Bitcoin (BTC) and USDT continued on September 21st, with full deposit services restored until September 22nd.

Hamster Combat HMSTR Airdrop: Controversy opens

Hamster Kombat, a popular tap-to-get game on Telegram, has faced massive backlash this week after losing more than 63% of its players to the highly anticipated HMSTR token. Set to launch on September 26, Weather aims to distribute 60 billion tokens to 131 million eligible players in the game's first season.

However, the controversy started when Hamster Kombat implemented anti-cheating measures at the last minute. This new approach has led to the banning of 2.3 million accounts by exploiting the game's reward system.

Players who invested a lot of time to accumulate Points Per Hour (PPH) were suddenly disqualified from the tournament. The decision sparked outrage on social media.

The controversy escalated as the price of the HMSTR token experienced high volatility after it began trading on major exchanges. It started trading at $0.014 but quickly fell by 20% to $0.011 within hours. The price reached about $0.0068506 as market sentiment eased.

Regardless of the backlog, the developers of Hamster Combat are confident that their anti-cheat system will ensure a fair distribution of rewards. Although the token's price has dropped significantly, developers remain optimistic about its long-term prospects.

Kamala Harris supports Crypto and AI in campaign speech

Vice President Kamala Harris shook up the tech and crypto industries this week with her first endorsement of cryptocurrencies as part of her presidential campaign. At a fundraising event in New York, Harris emphasized the importance of fostering innovation in AI and digital assets, which he said are critical to maintaining America's global competitiveness.

“We will work together to invest in America's competitiveness, to invest in America's future. We will promote new technologies like AI and digital assets while protecting our consumers and investors,” she said.

The statement marks a significant shift in Harris' policy platform, aligning her with key figures in the crypto industry, such as Ripple co-founder Chris Larson, who publicly endorsed her campaign. Larson, a proponent of blockchain regulation, believes Harris' position will help push forward much-needed regulatory transparency in the digital assets space.

Binance has denied a data breach involving 13 million users

This week, rumors swirled around Binance, one of the largest global crypto exchanges, about a data breach that may have affected 13 million users. Reports surfaced on dark web forums that a group of cybercriminals known as “Grevis” had access to sensitive user information. This information includes names, email addresses, telephone numbers and residential details.

The alleged information was put up for sale on Telegram channels, raising concerns within the Binance community. However, Binance quickly responded to these claims, denying any data breach.

“Our security team has thoroughly investigated the issue, and there are no reports of any data being leaked. We are committed to protecting our users' data,” a Binance spokesperson explained in a statement to BeCrypto.

Binance founder and former CEO Changpeng Zhao (CZ) is scheduled for early release from federal custody after being sentenced to four months in prison. CZ was arrested for violating the Bank Secrecy Act, a charge stemming from Binance's failure to comply with Know Your Customer (KYC) measures.

The CZ's release was originally slated for September 29. However, due to federal laws that allow for early releases when the official date falls on a weekend, recent reports suggest that it will be released earlier on September 27.

CZ initially faced a 36-month sentence. However, the sentence was significantly reduced in an agreement with the US Department of Justice (DOJ).

Despite its legal troubles, CZ remains a major influencer in the crypto industry. Many in the industry predict a return to focus on new ventures in blockchain, artificial intelligence and biotech.

Read more: Who is Changpeng Zhao? A deep dive into the former CEO of Binance

Although plagued by legal issues, the legacy at Binance is still considered crucial to the growth of global crypto liquidity. CryptoQuant CEO Ki Young Joo commented on CZ's impact.

“Don't underestimate CZ. He deserves credit for his contribution. While Binance has faced challenges, CZ's successes far outweigh its mistakes,” said Zhu.