Crypto Market Rocked by Bad News: What Happened?

1. Pi Network: The token’s price crashed 50% (from $1.97 to $0.737) following accusations of insider selling on May 18. Launched in 2019 by Stanford graduates, Pi Network allows users to mine crypto via a mobile app using the Stellar Consensus Protocol. With 60 million users, it gained traction for its accessibility, but its absence from major exchanges like Binance or Coinbase and a referral-based growth model have drawn comparisons to a pyramid scheme. Critics question the token’s value and liquidity.
2. Cardano: The Cardano ecosystem faced a crisis after claims of a 318 million ADA theft (worth ~$380 million at current rates). Founder Charles Hoskinson has threatened lawsuits, denying team involvement and calling the accusations fake. The situation was compounded by a December 8, 2024, hack of the Cardano Foundation’s X account, where attackers spread false claims about ADA’s delisting and a fake Solana-based token. Despite this, ADA’s price held steady at $1.19, showing resilience after a 170% surge over the past month. The scandals have fueled uncertainty, though the community remains active.
3. Blum: Blum co-founder Vladimir Smerkis was arrested on May 18 on suspicion of fraud. Positioned as a decentralized platform for trading and staking, Blum attracted attention with aggressive marketing and promises of high returns. Smerkis’ arrest triggered a 30% drop in the BLUM token’s price within 24 hours. Details of the case remain unclear, but the incident has fueled skepticism toward new projects amid broader market distrust.
4. Coinbase: The largest U.S. exchange suffered a data breach affecting less than 1% of its users. Hackers bribed overseas support staff, gaining access to names, addresses, and partial bank account details. The damage is estimated at $180–400 million, including compensation for affected users. Coinbase refused to pay a $20 million ransom, instead offering the same amount for information on the attackers. Disclosed on May 15, the breach led to a 4.1% drop in Coinbase’s stock. Users are urged to enable two-factor authentication and whitelist withdrawal addresses.
5. Binance and Kraken: Both exchanges faced phishing attacks on May 17, similar to the Coinbase breach. Hackers attempted to bribe support staff via Telegram, offering money for user data access. Thanks to internal security measures, including AI systems, no data was compromised. The attacks highlight vulnerabilities in customer support and the growing sophistication of cybercriminals, especially as crypto prices rise.