On March 28, THORChain announced that it had temporarily paused all trading due to reports of a potential vulnerability with a THORChain dependency that could impact the network. The decision was made as a precautionary measure while the reports were verified, according to THORChain. Social media reports had indicated that THORChain’s liquidity platform, Nine Realms, and its dedicated security team, THORSec, had received “credible reports” of a possible vulnerability affecting THORChain. As a result, the THORChain network was halted globally.

“Network preemptively paused by NO’s to investigate the report; updates will follow,” Nine Realms tweeted.

THORChain’s native token, Rune (RUNE), has dropped about 5% in value following the news, according to CoinGecko data. As of this writing, the token is trading at $1.32, down 18% over the past 30 days.

This is not the first time that THORChain has had to pause its network due to issues. In October 2022, the network was paused due to a software bug that caused “non-determinism between individual nodes.” After 20 hours of maintenance, the network was fully functional once again.

In 2021, THORChain also had to halt its network after suffering a breach, resulting in hackers stealing $7.6 million worth of cryptocurrency assets.

After about eight hours of the initial announcement, THORChain updated its Twitter account, stating that the vulnerability was credible but would require a malicious node in the last churn, which is when new nodes are added to the network. THORChain has resumed trading as no nodes can exploit the current vulnerability, according to the update.

In conclusion, THORChain’s temporary network pause due to a potential vulnerability serves as a reminder of the risks associated with decentralized protocols. While such protocols offer many benefits, they can also be susceptible to security vulnerabilities and breaches. THORChain’s quick response and resolution to the situation demonstrate the importance of having a dedicated security team and protocol in place to handle potential issues swiftly and efficiently.

Sam Wouters, a research analyst at Bitcoin financial service provider River Financial, believes that the recent spike in hash rate is linked to the inventory of mining hardware that was brought online last year. He notes that while Bitcoin’s price was low, miners brought as much inventory online as possible, and the network reached maximum capacity. However, with the recent price surge and some time passing, more inventory has been able to go online, leading to the spike in hash rate.

Wouters also suggests that Hydro models are starting to enter the market, with “250+ TH/s per machine, which adds tremendous hash rate.” Similarly, a March 20 analysis from investment banking company Stifel shared a similar sentiment, speculating that miners are bringing hardware back online, which is leading to the increase in hash rate.

One company that is benefitting from the recent surge in hash rate is TeraWulf, a US-based Bitcoin mining company. According to its CEO, Ammar Khan, TeraWulf has been able to continue mining Bitcoin at lower price levels due to its efficient mining fleets. Khan explains that some have speculated that lower prices forced miners to shut down their rigs and wait for the BTC price to improve, but TeraWulf has been able to continue mining due to their low-cost energy sites.

Khan also notes that TeraWulf has the opportunity to expand its capacity by 80 MW at LMD and 50 MW at Nautilus. He believes that the recent price movement is an indication of the long-term value of the ability to expand at low-cost energy sites. However, he does not expect the network hash rate to continue to increase through the first half of the year, as there is a lag between when investment decisions are made and when that capacity comes online.

In conclusion, while the exact reason for the recent spike in hash rate is unclear, it is evident that Bitcoin mining is becoming increasingly profitable, and miners are taking advantage of the current market conditions. As more companies enter the market, and more inventory comes online, it will be interesting to see how the hash rate continues to evolve and how it impacts the price of Bitcoin.

This marks a significant increase from the previous year’s investment of $2.2 billion, indicating a strong appetite for innovation and growth in the European crypto space. Notably, decentralized finance startups saw a 120% increase in investments, reaching a total of $1.2 billion in 2022.

Viktor Fischer, the CEO of RockawayX, emphasized that the crypto market is cyclical and that startup funding activity can hold steady even during a market downturn. He pointed to the 2018 winter, when “the total digital asset market cap fell by 80%, but startup funding activity held steady.” Investments made during such periods can lead to tech and usage traction alongside “bull market” price recoveries.

Europe is home to the highest number of crypto startups globally, with 3,977 startups based in the region, according to headquarters location. However, it lags behind the United States in the number of unicorns and startups with over $1 million in funding.

Top global investors in European startups include Animoca Brands, Coinbase, Blockchain Capital, and the Digital Currency Group. In Europe, investment in startups that provide financial services made up more than half (52%) of all investments, with infrastructure and Web3 making up 32% and 16%, respectively.

Compared to 2021, investment in financial service-based startups declined by 19%, while investment in infrastructure grew by 24%. This shift in investment focus reflects a growing interest in the underlying technology and infrastructure of the crypto industry.

Europe’s rising prominence as a crypto-friendly region comes as lawmakers in the European Union (EU) finalize the Markets in Crypto-Assets (MiCA) regulations. These regulations have been delayed twice due to translation issues, as laws passed in the EU must be translated into all 24 official languages of the member states.

If passed, MiCA will provide a regulatory framework for crypto-assets, including stablecoins, and establish requirements for issuers and service providers. The final vote on the regulations is set for April 2023, and their adoption is expected to provide greater clarity and stability for the European crypto industry.

In conclusion, despite the challenges faced by the crypto industry in 2022, European crypto startups continued to attract significant VC investment. As the industry continues to evolve and mature, investment focus is shifting towards infrastructure and Web3, reflecting a growing interest in the underlying technology of the crypto ecosystem.