Crypto Market Forecast: Midweek Update 4th August

Price reaction in the crypto markets has been muted this week despite the ecosystem suffering from two major hacks. The price of Bitcoin (BTC) is up ~0.29% and Ethereum (ETH) is down ~2.69% this week.

The Solana blockchain suffered a significant exploit that led to users of its major web3 wallets including Phantom, and Slope, reporting that their funds had been drained.

It is reported that around 8000 wallets have been affected. The attack primarily targeted users of Solana mobile wallets. The hackers have reportedly stolen US$5 million worth of SOL and Solana-based tokens.

SOL is down ~10.83% and is one of the worst performing large cap assets so far this week. In the last two years, the Solana ecosystem has been affected by numerous issues including outages caused by transaction overloads and the Wormhole bridge hack.

On Monday, cross-chain token bridge Nomad was attacked with the total value of assets lost close to US$200 million. This is yet another major bridge attack affecting the DeFi sector and follows the attacks on Ronin and Wormhole.

The attack occurred because of a new update to one of Nomad’s key smart contracts which made it easy for anyone to create bogus transactions that would be accepted. This allowed users to withdraw funds from the bridge that didn’t belong to them.

Altcoin Watch

Alongside Ethereum, most altcoins have had middling weeks that have not, however, derailed the strong recent periods of price momentum. Assets including Ethereum Classic (ETC), Uniswap (UNI), and Filecoin (FIL) are all up by more than 25% in the last two weeks.

Ethereum was able to maintain recent price momentum after its developers addressed a possible glitch that may have affected the Merge. The potential glitch could have created issues surrounding Miner Extracted Value (MEV).

There are growing rumors that a group of tearaway Ethereum miners will separate from the network, and try to take users with them when it transitions to Proof-of-Stake.

It has been reported that the new group aims to create a spinoff network that will continue to use Ethereum’s PoW model and that the new chain will function with a new currency called ETHPOW.