CertiK warns of a high-risk vulnerability on Telegram, and a U.S. congressman calls Bitcoin unstoppable. Good morning. You're listening to the Rise'n'Crypto podcast by Cointelegraph, with me, Robert Baggs, steering you through the crypto cosmos with daily dispatches from the digital frontier. If you want to stay ahead of the curve in crypto, make sure you click that follow button. Okay, grab yourself a coffee, and let’s get into it.
Well, it’s been a frustrating 24 hours. So in the bitcoin rundown, we're going to look at why we keep banging our heads on the same price. Then we'll look at the CertiK report which suggests Telegram has a high-risk vulnerability. A Solana developer explains the failed transactions problem, as well as why it might not be as big a deal as people are making out. And finally, a U.S. congressman discusses digital asset legislation and accidentally gives a locker room speech for Bitcoiners. So, although Bitcoin has ventured back north of $70,000 in the past few days, it has been struggling to solidify its position. We seem trapped in the nether zone between the past all-time high and the most recent one, despite being within 5% of that new all-time high. But the pattern of banging our head on that ceiling and then sliding back down has some analysts worried. So why is there a lack of momentum? The Trading Resource Material Indicators analyzed Orderbook data and concluded that a key reason is that whales are attempting to draw the price lower in order to enter new long positions on X material.
Indicators explained that the target time frame aligns with the United States Consumer Price Index, the CPI, which will land today, the trading resource wrote. If Wednesday’s core inflation numbers are hot, they will likely be able to extend the downside move. However, what often happens in these scenarios is that whales long the dip and exploit the upside liquidity void they just created for a relatively quick move up.
Okay, I’m going to try and explain that in simpler English. So what that means is that if the CPI report today shows high inflation in the US, it could cause Bitcoin's price to drop. But that could see a knock-on effect where whales buy up the Bitcoin at a lower price. This, in turn, will cause Bitcoin's price to go back up. So basically, as always, the US economy reports could cause some price volatility. Then, there is another influential factor that occurs every year around this time and that is tax season. Arthur Hayes, the co-founder of BitMEX, said the precarious period for risky assets is April the 15th to May the 1st. This is when tax payments remove liquidity from the system. This is also exemplified by data from Glassnode. Yesterday, Nancy Lu Bailey covered a report from Glassnode that stated that the Bitcoin market has, and I quote, transitioned into a euphoric phase, with profit taking markedly higher in terms of Bitcoin’s performance.
The crypto analytics firm found similarities between the 2021 bull run and Bitcoin’s year-to-date performance, most notably by the strong demand in spot markets. Furthermore, the data shows that inflows and outflows from exchanges have increased enormously since July 2023, with a combined monthly average of total inflows and outflows from exchanges at $8.19 billion per day. Now, what makes this stat so interesting is that this is much higher than the 2021 bull market peak. The balance between incoming and outgoing money is pretty even, hence the price stagnation. But the inflows are also interesting in and of themselves. Glassnode's data shows that there is a rise in new investors in the market, and Glassnode warned analysts should start to pay more attention to the behavior of these new investors as their share of the capital increases. I'll finish this Bitcoin rundown with the most influential new investors in the space, the spot Bitcoin ETFs. The dynamic of the new investors trying to offset one of the oldest in the space is back in action as after four positive net flow days Monday and Tuesday of this week are back in the red. Monday was a shocking $223.8 million in outflows, as Grayscale Bitcoin Trust saw $303.3 million left. And yesterday, Blackrock did a better job of covering Grayscale’s outflows, which were $154.9 million. But unfortunately, the day still ended at $18.6 million in overall outflows.
Grayscale has now reached nearly $16 billion in outflows, and any day now, they will have halved their Bitcoin holdings since becoming an ETF in January.
Telegram is the messenger of choice for crypto natives, and if you’ve ever attended a crypto event, you'll know that all people ask you for your Telegram handle. So naturally, when there are concerns raised about something as fundamental to the crypto ecosystem as TTelegram, it’s worth listening to. In a report yesterday, CertiK, the blockchain security firm, warned users of a major vulnerability on Telegram Messenger that they say could expose you to malicious attacks. They called it a high-risk vulnerability in the wild, and they stated that hackers could potentially deploy a remote code execution attack and RC through Telegram’s media processing, CertiK wrote. This issue exposes users to malicious attacks through specially crafted media files such as images or videos. Now, we discussed this with a spokesperson at CertiK, and they said that this is apparently exclusive to the desktop Telegram client. It's actually reasonably easy to avoid the vulnerability. So if you use the desktop client, here's what you do. You simply need to go on to the Telegram desktop settings, then to advanced, and disable the auto download media feature. Conversely, however, a spokesperson for Telegram told us that the company can’t confirm the existence of such a vulnerability in Telegram clients. In fact, Telegram has since denied the existence of this RC vulnerability, though some other security experts claimed it’s a known issue and not exclusive to Telegram, so it's hard to know who is correct here.
But if you use Telegram desktop, you might as well turn off the auto download of media until we know for sure. It's hard to print an episode without a story about Solana these days and to be honest, I’m okay with that. Whether it’s network failures or memecoin successes, there's always something happening, and yesterday's update is a little from each of those columns. On Friday, Gareth went through the news that up to 75% of Non-vote Solana transactions failed on the 4th of April as a consequence of this meme coin madness. Although the data was misconstrued by many, at least in part, there is a problem and as a consequence of the network’s explosive growth. Mert Mumtaz, the CEO of Helios Labs, a blockchain infrastructure firm that provides back-end support exclusively to the Solana network, took to X to clear some things up. Most people don’t understand the issue, and this lengthy post is therefore important. It's linked in the description of this episode, but I will give you my abridged version. Mumtaz wrote that Solana's current issue is not a design flaw; it’s an implementation bug. When we say the word implementation, we are saying it in the context of a certain design. For example, think of a car. A car’s design is simply a vehicle with four tires and an engine.
However, there are many implementations of the car's design, for example, BMW, Mercedes, Toyota, Formula One, Tesla, etc. These all adhere to the same high-level design idea of a car but implement them with varying differences. If a BMW has poor steering in one of its models, we don't say that all cars are flawed. We say the specific model or implementation is broken, right? So, according to Mumtaz, one part of Solana’s design has had buggy implementation of its Google-developed data transfer protocol, quick, which is quick and that tells all the nodes what the current state of the network is. As Brad and Andreas summarized, Solana needs to change a tire rather than recreate an entirely new model or network in blockchain terms. Mumtaz added on X that a fix for this buggy implementation will take place on the 15th of April. But he did also tell us that the fix on the 15th will be a reconfiguration of quick and a superior solution will come at a later date. What do you make of this situation on Solana? Is it just growing pains that every organization experiencing explosive growth has to deal with, or is Mumtaz playing down the problem? Share your thoughts with us on ATS, Cointelegraph, at RCB bags on X, and at RCB bags on Warp. Cast. Representative Patrick McHenry, the chair of the United States House Financial Services Committee, spoke out about digital assets at the Bitcoin Policy Summit in Washington, DC yesterday.
And as dull as that all sounds, there are some really interesting takeaways. Mchenry is not seeking re-election in 2025, and it seems that his hopes for his remaining time in office revolve around legislation on digital assets. Legislation on digital assets causes a knee-jerk recoiling in many crypto folk, but as every major player in crypto knows, it is necessary. If done correctly, there is a profound lack of clarity around digital assets in the US, and it makes it difficult to build in the sector safely, McHenry said yesterday. We don’t have a federal law, a definition of a digital asset. We don't have in federal law a means of exchange for a digital asset. We have to provide that clarity. He added that the key thing to remind members of Congress, though, is that we now have this thing that is not defined in federal law. So this is a problem. Mchenry is, however, hopeful about the financial innovation and technology for the 21st Century Act, as well as the clarity for Payment Stablecoins Act, both of which were approved by the House Financial Services Committee in 2023. The Financial Innovation and Technology for the 21st Century Act, in particular, would, and I'll quote McHenry here, state clearly what is a commodity, what is a security for digital assets. And it would create a means of exchange. I don’t think I really need to point out how important that is, as it is the backbone of most flagship crypto legal cases.
Now, this might be coming off rather neutral, but I’ve generally really liked Mchenry's thoughts on crypto whenever I've heard him speak on it.
Yesterday, there were two standout parts of his talk at the Bitcoin Policy Summit that particularly resonated with me. The second one I read, you borders a locker room speech, so I’ll end on that one. Firstly, when discussing crypto’s many opponents, McHenry criticized their lack of knowledge and kind of lack of due diligence on the topic. He said if they just take the time to. To read Satoshi's white paper. It is a much easier conversation that willingness to not educate themselves leads them down. Rabbit holes of misinformation. I like to think that McHenry is referring there to the exaggeration of crypto's role in crime. And then McHenry fired up the Kryptonians, which I reckon you’ll see quoted left and right when he said, every regime that has tried to shut Bitcoin down has failed. It is an unstoppable piece of technology.
Oh, that is a good note to end on. So that is it for today. Consider yourself informed. Thank you for listening to the Rise’n’Crypto podcast by Cointelegraph. If you’re enjoying these daily updates, please make sure you let us know by following, subscribing, or leaving a review. Have a great day! Let’s do this again tomorrow.