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A Dragonfly Researcher Breaks Mimblewimble’s Privacy, Proving That The Model Is Flawed

It is quite a pity that the esteemed privacy of Grin has been tampered with by a Dragonfly researcher who was able to unearth the real addresses of senders and receivers of up to 96% of transactions carried out in Grin’s blockchain. The researcher shared this on a Medium post on Nov.18.

The researcher claimed that some other researchers have sometimes said that the privacy model of Mimblewimble, a privacy-focused blockchain protocol, is suffering from some weakness and, therefore, flawed. His recent live testing on Grin has proved the speculation to be true since he was able to uncover the sending and receiving of transactions with an estimated success rate of 96%. This made the researcher conclude that Mimblewimble is not a reliable privacy chain.

One major thing of concern about this faulty privacy protocol is that it is part of Mimblewimble; it is inherent to the protocol without much hope of being fixed. This unfortunate event made the researcher warn that Grin/ Mimblewimble should not be taken as an alternative privacy protocol with reference to Zcash or Monero.

The researcher claimed that Mimblewimble developers are aware of the technical issues and feasibility of an attack, they did not do anything even though he warned them on a Reddit post last year.

In the said post, the researcher did not spare any information regarding the attack, how it works, and what it means for privacy tech. He then provided technical details into this attack with open-source code to reproduce it, data collected, and a technical Frequently Asked Questions.

Image via Shutterstock

Digital Asset Venture Dragonfly Acquires Crypto Fund MetaStable Capital for Rebranding

Digital asset venture capital firm Dragonfly has acquired cryptocurrency investment fund MetaStable Capital, according to Bloomberg.

MetaStable Capital is a long-term value investing crypto asset hedge fund with over $400 million in assets under management as of July 31.

This company has invested in Ethereum, Avalanche, Cosmos, Starkware, NEAR and Algorand.

The exact amount of the acquisition was not disclosed to the official. Dragonfly added that the acquisition was rebranding, renaming it MetaStable, dropping “Capital”, and using a new logo.

Qureshi, a former partner at MetaStable, said that:

“The bear market has caused a lot of traditional funds and crossover funds to exit the crypto market. We’re the opposite: we’re going deeper, and committing to our crypto-native roots.”

By 2022, $17 billion in VC cryptocurrencies and +1k deals have flowed into the crypto market. This year has the highest median deal size, with the highest funding raised at $4.5 million.

Qureshi explained that DragonFly Capital has grown much from its previous size and believes that traditional VCs will eventually return.

Recently, DragonFly Capital launched a $650 million venture capital fund to continue investing in the broader digital currency ecosystem.

In early August, Dragonfly Capital completed a $3.5 million seed round of funding for the encrypted credit protocol Debt DAO.

In May, Dragonfly Capital closed its third venture capital fund with an oversubscribed $650 million. The investment firm lists DeFi, DAOs, NFTs, and scaling smart contracts as its main focus areas.

VanEck Spearheads Entry into Stablecoin Market with Agora's AUSD Launch

Agora, initiated by Nick van Eck, the progeny of Jan van Eck, the CEO of the renowned investment management firm VanEck, is poised to introduce a new stablecoin named AUSD. This digital dollar is designed to be pegged to the US dollar, offering a secure and stable cryptocurrency option amidst the volatile crypto markets.

The creation of AUSD is backed by a substantial $12 million in seed funding, led by Dragonfly, a prominent player in the crypto investment field. The funding round’s success signals strong investor confidence in Agora’s vision and the stablecoin market’s potential for growth.

The AUSD stablecoin stands out from its peers by being directly backed by a combination of cash, U.S. Treasury bills, and overnight repurchase agreements, which are short-term loans typically used by financial institutions to raise capital. This diversified approach to backing ensures that AUSD maintains a stable value, closely mirroring that of the US dollar, thereby providing users with a reliable medium of exchange and value storage.

In a strategic move, VanEck will manage a dedicated fund responsible for overseeing Agora’s reserves. This decision leverages VanEck’s established expertise in investment management, thereby instilling additional trust in the stablecoin’s operations and financial stability.

The launch of AUSD by Agora comes at a time when the stablecoin market has seen exponential growth, with a significant increase in demand from both retail and institutional investors seeking a safe haven within the digital asset space. In this light, the entry of a reputable investment management firm such as VanEck into the stablecoin industry is a noteworthy development.

The utilization of stablecoins like AUSD is anticipated to play a pivotal role in the future of finance, providing a bridge between traditional financial systems and the burgeoning world of cryptocurrency. As such, Agora’s partnership with VanEck could potentially herald a new era of digital finance, offering enhanced stability and security to users.

The introduction of AUSD also raises important considerations regarding regulatory compliance and oversight. In the United States, stablecoins have garnered attention from regulatory bodies like the Securities and Exchange Commission (SEC) and the Office of the Comptroller of the Currency (OCC), both of which are keenly observing the market’s development to ensure investor protection and market integrity.

As the stablecoin market develops, it is expected that further regulatory frameworks will be formed to oversee the issuance and maintenance of assets such as AUSD. In the meanwhile, Agora’s resolve to keeping a strong reserve, administered by a trustworthy company like as VanEck, offers a good example for others in the industry to follow.

In conclusion, the launch of AUSD by Agora marks a significant milestone in the intersection of traditional finance and cryptocurrency. With the backing of an industry titan like VanEck and solid funding from Dragonfly, AUSD is poised to make a lasting impact on the digital currency landscape.