wintermute - Pwim.Net

Wintermute Rolls out Crypto OTC Trading Platform for Institutional Clients

On Wednesday, Wintermute, a global crypto market-maker headquartered in London, announced that it has launched a new over-the-counter (OTC) platform, called Wintermute NODE, designed to enable institutional clients and qualified investors to trade digital assets and their derivatives.

Wintermute said that the new platform is intended to be a one-stop shop to provide price discovery, trading, and exposure monitoring of digital assets. The platform will charge zero fees and allow customers to access Wintermute’s liquidity over API and web interface directly.

The firm stated that Wintermute NODE allows buying and selling any token, any product, in any manner. According to Thursday’s statement, Wintermute NODE runs 24/7 on 60+ centralized and decentralized exchanges, offering liquidity and a variety of CeFi and DeFi venues and buying and selling over $5 million a day. Businesses can also access perpetual futures, CFDs, and NDFs on the new OTC platform.

Wintermute explained that NODE aims to play a vital role in enabling institutional buyers like family offices, hedge funds, blockchain natives, and other big-money players to access OTC crypto buying and selling and participate in niche markets like decentralized finance (DeFi).

Wintermute NODE appears to be competing against other institutional trading platforms (like FalconX and Coinbase Prime) that offer access to crypto order flow.

Evgeny Gaevoy, the Wintermute founder and CEO, commented about the development and said: “The others are charging a lot. Our platform eliminates an extra layer of fees.”

Providing Access to Capital and Market Liquidity

Wintermute NODE is an expansion of the firm’s OTC API flagship product unveiled in June 2021 that functions as a liquidity delivery mechanism for digital asset trading.

Established in 2017, Wintermute has served as a crypto market maker focused on high-frequency algorithmic trading and market-making services. Since its launch, Wintermute continues to fulfil its mission to create transparent, efficient, and liquid markets for retail and institutional investors across centralized and decentralized exchanges and OTC trading platforms.

DeFi Protocol Wintermute Suffers $160M of Hack: CEO

Cryptocurrency market maker and Decentralized Finance (DeFi) lending protocol Wintermute has been hacked with over $160 million lost.

In a Twitter update shared by Evgeny Gaevoy, the protocol’s co-founder and Chief Executive Officer said the hack did not affect the platform’s Centralized Finance (CeFi) and OTC operations.

While the exact way the exploit was conducted was not revealed, Evgeny said the startup is twice as solvent as the amount carted away, and there is no cause for alarm. He, however, warned that there might be service disruption today and for the next few days as attempts will be made to bolster audit and general security measures.

“We’ve been hacked for about $160M in our defi operations. Cefi and OTC operations are not affected. We are solvent with twice over that amount in equity left,” Evgeny revealed in his Twitter update, adding that “If you have a MM agreement with Wintermute, your funds are safe. There will be a disruption in our services today and potentially for the next few days and will get back to normal after.”

With an understanding of the uncertainties that might have gripped its users, Evgeny said lenders need not worry as Wintermute is very much solvent. He, however, encouraged anyone who has plans to recall their funds to do so, affirming that such requests will be processed.

Wintermute said of the 90 assets affected, “only two have been for notional over $1 million (and none more than $2.5M), so there shouldn’t be a major selloff of any sort.”

In the short thread, the CEO said the platform is still willing to treat the hack as a Whitehat and encouraged the hacker to get in touch with the team.

Wintermute will be yet another DeFi protocol to suffer a damning attack this year, following the likes of Ronin Bridge, Nomad, and Beanstalk, amongst others.

Amber Group Successfully Replicates Wintermute's $160M Hack

Many may consider hackers to be geniuses, however, their talent can always be reciprocated and Amber Group has just proven that.

The crypto firm announced on Twitter that it was able to replicate the $160 million hack of Wintermute by reproducing the private key that was used to carry out the attack.

“We have reproduced the recent Wintermute hack. Figured out the algorithm to build the exploit. We were able to reproduce the private key on a MacBook M1 with 16G memory in <48h,” the firm tweeted following its self-initiated investigation into the exploit event.

Amber Group confirmed its claims by leaving an on-chain message to prove its claims. When the Wintermute protocol was hacked on September 20, Chief Executive Officer, Evgeny Gaevoy noted that despite the exploit, the protocol is still very solvent and can fulfill all of its obligations to its creditors and users.

Per the insight that the Amber Group investigation proffered, the digital currency platform said that it too “could extract the private key belonging to Wintermute’s vanity address and estimate the hardware and time requirements to crack the address generated by Profanity.”

The attempt proved successful and Amber said “Profanity relied on a particular elliptic curve algorithm to generate large sets of public and private addresses that had certain desirable characters.” As part of Amber Group’s conclusion, the firm said the process that was used to generate the addresses that were used to exploit Wintermute is not random and could easily be regenerated.

“We figured out how Profanity divides the job on GPUs. Based on that, we can efficiently compute the private key of any public key generated by Profanity. We pre-compute a public key table, then do reverse computation until we find the public key in the table,” Amber said.

The replication exercise showcased that hacks can be successfully investigated, and proactive solutions designed to help forestall negative events like those of Wintermute’s.

Wintermute-Backed Decentralized Exchange Bebop Expands to Polygon

Following its launch on the Ethereum blockchain in June, Bebop, a decentralized exchange (DEX) incubated by crypto trading firm Wintermute, has now expanded support to Polygon.

With Bebop’s expansion to Polygon, the DEX aims to benefit from Polygon’s lower network fees and faster transactions while also getting the same price quality of that as Ethereum.

Katia Banina, Head of Product at Bebop, stated in an announcement, ‘’By DeFi standards, Polygon fees are negligible, which is paramount for delivering this efficiency to all users for any transaction size.’’

Bebop is a decentralized exchange with a rare feature compared to other DEXs. The platform boasts its ability to trade multiple tokens in a single transaction, a feature the Bebop calls its signature “one-to-many” and “many-to-one” trading.

Evgeny Gaevoy, founder and CEO of Wintermute, noted: ‘’Imagine the future where you are able to convert any digital asset you own to any other asset, from an NFT collectable on one chain to tokenized crypto company bond issued on another. All this without even thinking how it’s possible — all because of the advanced technology and ultimate user simplicity.”

Though Bebop is only just kicking off with Ethereum and Polygon, as the exchange stated, its first focus is integrating cross-chain swaps between these two blockchains. The team said the platform’s long-term vision is to enable the ‘’permissionless transfer of value across the multi-chain world.’’ Prior to its launch on Polygon, the platform already had over 30,000 people on its waitlist.

This news comes amid the rush of several partnerships and the adoption of the Polygon blockchain. Last week, Instagram announced its collaboration with Polygon to introduce a non-fungible tokens (NFTs) marketplace that will run with the support of Polygon. The same week, banking giant JPMorgan completed its first-ever decentralized finance (DeFi) pilot test over Polygon.

The result of these adoption and partnership deals has had some impact on the blockchain’s native token, MATIC. Over the past weeks, MATIC has surged by over 40%, reaching a six-month high of $1.29 on Monday.

Meanwhile, as of the time of writing, MATIC is currently hovering around $1.19, down by 5% with a 24H trading volume of $1,840,140,198, according to data from Coinmarketcap.

Image source: Bebop

Significant Unlock of Optimism's OP Tokens Imminent, Wintermute Transfers a Large Batch to Binance

According to Token Unlocks data, a significant amount of Optimism’s OP tokens is scheduled for release on May 31st. A total of 386,547,056.64 OP tokens, equivalent to approximately $587 million and accounting for 9% of the total supply, are set to be unlocked. This includes 204,010,947 OP tokens for core contributors and 182,536,110 OP tokens for investors.

Furthermore, as monitored by Spot On Chain, Wintermute, one of the B-round investors of Optimism, has transferred 2.651 million OP tokens to Binance over the past 42 hours. The tokens, which were transferred at an average price of $1.63, amount to a total of $4.31 million.

Wintermute’s move comes ahead of the significant token unlock event, wherein OP tokens worth $587 million will be released on May 31st, representing 9% of the total supply.

It’s worth noting that the impact of such a substantial token release on the market could be significant, given the large value and volume of tokens involved. The market and the Optimism community will be closely observing the aftermath of this unlocking event.

Wintermute Seeks $1.98M YFI Loan from Yearn DAO

Wintermute Trading has approached the Yearn community with a proposal for a 12-month loan of 350 YFI, equivalent to $1.98 million, from the DAO’s treasury. The loan, if sanctioned, would carry a 0.10% interest rate, payable at the term’s conclusion.

As part of their ongoing collaboration with Yearn, Wintermute plans to allocate up to 3M CRV ($1.4M) to purchase yCRV. They will subsequently deploy these assets to the yCRV-CRV Curve pool (lp-yCRV V2) on Yearn for at least 12 months. This initiative aims to rebalance the pool, currently at a 59%/41% yCRV/CRV ratio, enhance the yCRV peg, and augment the pool’s liquidity.

The DeFi sector recently grappled with challenges, notably a bug in certain Vyper versions, leading to a significant liquidity reduction for CRV. This caused concerns within the Aave community due to CRV’s price drop. Wintermute Trading, having been involved in OTC trades across DeFi, now seeks to deploy some CRV tokens on platforms like Yearn.

Established in 2017 by three Optiver veterans, Wintermute Trading is a leading crypto-native algorithmic trading firm. They’ve traded over $3T since their inception, expanding their footprint across 80+ exchanges.

The borrowed YFI will be strictly used for trading. Wintermute also intends to deploy yCRV tokens to the yCRV-CRV pool on Yearn for a minimum of 12 months. A 3/4 multisig will be set up, ensuring transactions require at least one signature from a Yearn contributor.

At the 12-month term’s end, Wintermute commits to returning the full 350 YFI loan amount with the 0.10% interest to the DAO’s treasury. If the Yearn DAO greenlights the proposal, the 350 YFI will be transferred to Wintermute’s specified address, followed by the establishment of a 3/4 multisig.

The Yearn community now faces a pivotal decision: to approve or decline Wintermute’s proposal.

Wintermute Accuses Near Foundation and Aurora Labs of Failing to Honor USN Redemptions

Wintermute, in an unexpected public disclosure, has raised a serious allegation against the Near Foundation (NF) and Aurora Labs regarding the redemption process of the USN stablecoin. In a series of tweets, Wintermute’s CEO, Evgeny Gaevoy, criticized the entities for not honoring their public and private commitments to redeem USN tokens for USDT, leading to substantial financial repercussions for Wintermute and possibly setting a detrimental industry precedent.

USN’s Troubled Journey

Initially launched as an algorithmic stablecoin similar to Terra’s UST, USN underwent a transformation to a non-algorithmic model backed by USDT amid the market’s instability. Despite the changes and a subsequent collateral deficit, NF announced the USN Protection Programme, assigning Aurora Labs to oversee its operation. However, the program has since been marred by a failure in implementing redemption promises.

The Unresolved Transaction

Wintermute, in its role in asset liquidation for the FTX bankruptcy estate, sold 11.2 million USN, expecting to redeem the tokens for over $11M for FTX creditors. This expectation was based on NF’s assurances and Aurora’s private confirmations. The subsequent refusal to redeem these tokens has left Wintermute in a state of limbo, with negotiations leading to a disappointing offer from NF amounting to only a fraction of the original value.

The Path Forward

Highlighting the lack of accountability and clarity from NF and Aurora, Wintermute is preparing to take legal steps. Gaevoy’s disclosure is not only a call for resolution but also a signal to the industry about the importance of corporate responsibility and transparency. The company is reaching out to others similarly impacted and is firm on its stance to switch to an adversarial mode if their calls for redemption continue to be ignored.

The unfolding scenario raises questions about trust and integrity in the crypto market, as prominent entities like NF and Aurora Labs face scrutiny. Wintermute’s commitment to transparency and the industry’s ethical standards is evident as they navigate through this challenging episode.