Friday, September 30, 2022

New York Senator Introduces Bill Targeting Crypto Rug Pulls

Cyber theft and other cyber crimes have been on an uprise in recent times. Many crypto firms have suffered losses from hacks and other infringements on their network. As a suggestive method of curbing the menace and streamlining the operations of the perpetrators, New York Senator Kevin Thomas has suggested to legislative officers corrective frameworks that would match up with the structures of the crypto space.

New York has optimally displayed a level of willingness to regulate and monitor virtual digital assets circulation and trade in the country. Senator Kevin’s bill dubbed “Senate Bill S8839” contains structures and amended rules (which aim at redefining crypto operations, spelling out activities that qualify as cybercrimes, and distributing sanctions to such crimes), hopes to protect developers and investors from hackers.

Activities tagged to be connected with cyber theft were an abuse of security keys without authorization from the owners especially for fraudulent operations, developers who fail to provide the names of private digital assets firms who transact in tokens on the homepage of their websites, and other disguised interest in digital assets.

Also included in the amendment is the law that says any developer who makes a sales of more than 10% of a particular token in the last five years following the time the last sales were made, would attract a ‘rug draw fee’.

There has not been a final verdict by the committee on this proposed bill at the time of this writing. Once the bill is passed, it would become effective 30 days after its passage.

Incessant Attack on the Crypto Blockchain

The series of cyberattacks on the crypto space has led to the loss of huge amounts of cryptocurrency. The attack on the Ronin Network which was later tied to the North Korean cybercrime group, Lazarus Group, amounted to a total loss of $625 million in crypto.

Protocol Qi Dao also suffered a breach which led to a withdrawal of $13 million from its system. The market value experienced a 65% crash in its value which turned to a decline in the worth of the stablecoin protocol. The recent New York Bill is aimed at protecting investors from these cybercrimes, and rug pulls in general in which developers abandon their projects to the detriment of the investors.

Victoria Nye
A Blockchain columnist who is enthusiastic about developing a network interface between the real world and the cryptosphere.

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