BlockTower Capital, a digital asset investment company, is facing a significant setback after scammers breached and partly depleted the primary hedge fund.
According to Bloomberg reports, after notifying its limited partners of the theft, the company also hired blockchain forensics analysts to investigate how the money was taken. However, the stolen funds are still missing, and the hacker has not been captured.
Assets under management at the company total $1.7 billion, according to data provider PitchBook. However, it is not clear how much money was breached from the company’s fund.
BlockTower was founded in 2017 and has offices in Miami as well as in New York. The company has invested in nonfungible token developer Dapper Labs, gaming studio Sky Mavis, and Terraform Labs, creator of the failed TerraUSD stablecoin.
BlockTower has faced difficulties before this hack. The company closed its “market-neutral” cryptocurrency fund last year, which at one point managed over $100 million, as investment opportunities for the approach dried up.
Scams and hacks targeting retail cryptocurrency investors have increased in the last year, despite the fact that they stole less money in 2023, which is less than in 2022. There were more individual hacking incidents; in 2022, the number was 219, which rose to 231 in 2023.
The research firm TRM Labs claims that these cryptocurrency hacks are still a major problem for digital assets in the study, with scammers taking roughly $1.7 billion from projects in the previous year.
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