Bitfinex LEO Token Surges To Top 30 After Recovering Hacked Bitcoin• February 13, 2022 5:13 pm • Comments
Bitfinex’s UNUS SED LEO token (LEO) has recently entered the top 30 on CoinMarketCap after achieving a total market capitalization of around $5.8 billion within a short amount of time.
This recent price change is a new all-time high for the token whose main utility is a basic exchange utility token which means that it is mainly used to lower fees on the trading platform.
Back in 2019, Bitfinex was able to raise an impressive $1 billion for this token indicating the demand from traders as well as the popularity of the exchange.
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The LEO token has not been in the spotlight for quite some time, but the recent price surge that allowed it to reach the top 30 cryptos list in market cap is attributed to the recent recovery of $4 billion worth of BTC that was lost to hackers back in 2016.
Bitfinex’s LEO Token Explodes after US Seizes $4B of Bitcoin Lost in 2016 Hack – https://t.co/0Pfdiac6HE
— Crypto Multiple (@cryptoearnway) February 8, 2022
On Tuesday, the United States Department of Justice announced that it has recovered 94,000 BTC that had been stolen in an Aug. 2016 hack against Bitfinex, a cryptocurrency exchange.
Hackers stole 119,754 BTC, worth $72M at the time.
“Today’s arrests, and the department’s largest financial seizure ever, show that cryptocurrency is not a safe haven for criminals,” Deputy Attorney General Lisa O. Monaco said in the DOJ’s statement.
The statement names Ilya Lichtenstein and Heather Morgan as the two it has charged with attempting to launder the stolen property.
The price of Bitcoin at the time was around $625.
Today, a single Bitcoin fetches $43,000, meaning the recovered trove is worth more than $4B.
The reason why this caused LEO to increase in price is because Bitfinex’s whitepaper states that it had pledged to use any recovered funds from the hack to buyback LEO and burn it.
This would dramatically reduce the amount of tokens in circulation therefore increasing the value of each token.
The whitepaper also states that the buyback would not be all at once in order to avoid market manipulation, but would be distributed over a period of 18 months in order for the price to stabilize.
The buyback has not started yet, but the recent price surge seems to be coming from the upcoming anticipation of the buyback from traders and investors now speculating on the true value of the token.
In a statement following the news, Bitfinex said, “We want to express our appreciation for the dedication and hard work by the DOJ team that led to this great success. We will continue to support their efforts.”
The name of the LEO token comes from the Latin phrase, “Unus sed leo,” which is from Aesop’s fable “The Lioness,” the moral of which is quality over quantity (the story’s subject has only one child at the time, but it’s a lion).
On that note, there will soon be considerably fewer LEO tokens in circulation if all goes according to the stated plan.
The price action today appears to be in reasonable anticipation of a large contraction in the token supply due to this successful law enforcement action.
The token can be compared to the BNB coin that is used on the Binance exchange which is currently ranked 4th in total market cap.
Basic exchange utility token derive value from the exchange platform that it is used on and outlook for LEO may continue to improve if Bitfinex continues to remain as one of the top crypto exchanges in the future.
— The Crypto Outlook (@thecryptoutlook) February 9, 2022
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