Solana is set to release 11.2 million SOL tokens today, valued at approximately $1.57 billion. This unlock is part of the ongoing bankruptcy process for the defunct FTX exchange.

Notably, the unlock comes as mounting legal expenses are making FTX bankruptcy one of the most costly Chapter 11 cases in US history.

A Massive Solana Token Unlock for FTX Bankruptcy Estate

On-chain data shows that the unlocked SOL represents about 2.2% of Solana’s circulating supply, which currently stands at 488 million tokens.

Still, the FTX estate has two additional smaller SOL unlocks in the coming months. On April 1, 12,700 SOL will be released, followed by 73,700 SOL on May 1.

These tokens were part of FTX’s holdings, which had been sold at discounted rates to investors in previous auctions.

Sunil Kavuri, a leading creditor advocate, revealed that FTX had liquidated 41 million locked SOL across three auctions. According to him, the buyers included crypto investment firms like Galaxy Digital and Pantera Capital.

Indeed, Galaxy Digital, the largest buyer, secured 25.5 million locked SOL at $64 per token, well below the current market price of $144.

Pantera and other firms made their purchases at approximately $95 per token. Meanwhile, Figure and its partners acquired SOL at $102.

Arthur Cheong, founder of DeFiance Capital, confirmed his participation in Galaxy Capital’s over-the-counter (OTC) sale. He stated that he purchased an undisclosed amount of SOL at $64 per token. Cheong also mentioned that he has no plans to sell, as he anticipates a significant price increase.

“Participated in the SOL OTC deal at $64 via Galaxy and received the bullet unlock today. Not selling a single one of them. I think it will be substantially higher in 3 months,” Cheong stated.

Meanwhile, the release of SOL tokens raises concerns about potential selling pressure. A flood of new tokens could increase supply and push prices downward.

Over the past week, Solana’s price dipped to a four-month low of around $136 amid a broader crypto market decline. However, the digital asset’s value has since rebounded to approximately $140 as of press time.

Moreover, this development comes as FTX’s bankruptcy proceedings entered a critical phase, with initial creditor distributions underway.

However, the legal expenses tied to the case are nearing a staggering $1 billion, positioning it among the most costly Chapter 11 filings in US history.

This week in crypto, the Lazarus Group stole $1.5 billion from Bybit, yet the exchange has sustained the damage and remained operational. US Bitcoin ETFs saw a record $2.6 billion outflow turning BTC bearish and impacting major crypto stocks. At the same time, meme coin scams on social media are still on the rise.

On the regulatory front, the SEC dropped its lawsuit against Coinbase, prompting one Commissioner to accuse it of open corruption. Meanwhile, the recently launched Pi Network is being accepted by some Florida businesses.

Lazarus Group Pulls Off $1.5 Billion Hack

One week ago, Bybit, a leading crypto exchange, was hacked. With $1.5 billion in damages, it was the most successful crime in crypto history. A few conflicting narratives circulated throughout the community, but famous sleuth ZachXBT cracked the case.

The culprit was none other than the Lazarus Group, a North Korean hacker collective.

“At 19:09 UTC today, ZachXBT submitted definitive proof that this attack on Bybit was performed by the Lazarus Group. His submission included a detailed analysis of test transactions and connected wallets used ahead of the exploit, as well as multiple forensics graphs and timing analyses. The submission has been shared with the Bybit team,” Arkham claimed.

The Lazarus Group conducted a sophisticated security breach that sought to exploit Bybit’s wallet signing process. Safe Wallet confirmed that the hackers were able to breach its infrastructure but claimed its smart contracts remain secure.

Several community figures criticized its statement as too vague. Bybit, for its part, has rebuilt its reserves through several methods. The industry and crypto community have applauded the exchange’s excellent crisis management.

SEC Drops Coinbase Lawsuit, Dissension in the Ranks

After hinting that it would do so for weeks, the SEC finally dropped its lawsuit against Coinbase this week. Brian Armstrong, the crypto exchange’s founder and CEO, pre-emptively announced that he and the SEC struck a deal, but it took a few days for everything to finalize.

“Great news! After years of litigation, millions of your taxpayer dollars spent, and irreparable harm done to the country, we reached an agreement with SEC staff to dismiss their litigation against Coinbase. Once approved by the Commission (which we’re told to expect next week) this would be a full dismissal, with $0 in fines paid and zero changes to our business,” he said.

The Commission has been dropping several lawsuits and enforcement probes into the crypto industry this week. However, the SEC’s lawsuit against Ripple is still active, and there’s no clear hint of when it will end.

Additionally, these actions have attracted criticism from within the Commission.

Earlier today, Commissioner Caroline Crenshaw publicly lambasted the SEC’s shift towards the crypto industry. She accused its leadership of willfully ignoring 80 years of precedent to deliberately favor a political faction.

Moreover, she did not offer to resign and will remain an active Commissioner for over three months. This is a shocking upset to the SEC’s normal operations.

Bitcoin Drops 17%, Damaging ETFs and Corporate Holders

Strategy (formerly MicroStrategy), one of the world’s largest Bitcoin holders, recently spent nearly $2 billion on the asset. However, this did not help the company’s stock price, following sharp drops in BTC itself.

This fueled concerns that Strategy may have to liquidate some of its crypto holdings, as it might be overleveraged into the asset.

“Forced liquidation of MSTR is not necessarily impossible. But, it is highly unlikely. It would need a “mayday” situation to occur,” one commentator claimed.

Since those rumors started two days ago, things have gotten worse. Several key metrics are showing a decline in Bitcoin, and it’s proved contagious. Bitcoin ETFs had $2.6 billion in outflows this week, and corporate Bitcoin holders like Strategy and Tesla are all dropping.

Liquidations are up, and the Federal Reserve is predicting economic downturns; it looks like a bear market.

Pi Network Gets Institutional Adoption in Florida

Pi Network, one of the highly-anticipated crypto projects, made new headway in institutional acceptance this week. According to several social media posts, a Florida real estate company is now accepting Pi tokens. Cube Motor, a car dealership in the state, also set up similar infrastructure.

“American film producer and actor James J Zito is currently the director of Zito Realty, a real estate company in Florida, USA, which accepts real estate transactions with Pi coins,” the post read.

Pi Network is generating huge amounts of hype, with Binance’s community overwhelmingly voting to list the token. However, not everyone in the crypto sphere is thrilled with the project.

Before the hack, Bybit CEO Ben Zhou called the project a scam and a pyramid scheme. Its price is showing a few signs of market fatigue, but nothing definitive has happened yet.

Meme Coin Scams Are On the Rise

Kanye West, a famous American rapper, may or may not be wrapped up in a social media scam. Earlier this month, he denied involvement with any extant Kanye meme coin but allegedly planned to launch his own.

However, some crypto sleuths are speculating that he sold his X account to Barkmeta for $17 million, enabling a major fake token scam.

“Kanye West sold his X account for $17 million. The most anticipated meme coin launch is Barkmeta’s rug pull. The chance of YE’s sold account is above 95%. I do not recommend you to buy Kanye’s meme coin in any case,” a sleuth named Blade claimed.

A scam-centric paranoia is circulating through the crypto space, and the Bybit hack is only helping matters. Pump.fun’s social media account was hacked to promote a scam this week.

After the initial posts were deleted, the hackers were able to advertise another scam on the same page minutes later. Fears are building that this chaos is damaging the industry’s reputation.

In short, a lot has happened in crypto this week. Major crimes and bearish market conditions go alongside political developments and institutional adoption.

A US federal court has dismissed the SEC’s lawsuit against Richard Heart, the founder of HEX, citing jurisdictional overreach.

Following the decision, tokens associated with Heart—HEX, PulseChain, and PulseX—have surged in value, with HEX leading the rally with a nearly 80% gain.

Judge Rules Against SEC in Richard Heart Case

On February 28, the US District Court for the Eastern District of New York ruled in favor of Richard Schueler, widely known as Richard Heart, dismissing the SEC’s lawsuit against him.

The agency had accused Heart of conducting an unregistered securities offering, alleging that he raised over $1 billion in cryptocurrency assets.

It also claimed that Heart and his blockchain project, PulseChain, misappropriated at least $12 million for luxury purchases, including high-end cars, watches, and a rare black diamond.

Heart resisted these claims, arguing that the SEC lacked jurisdiction over his activities. He maintained that the regulator failed to prove that his actions specifically targeted US investors or violated domestic securities laws.

US District Judge Carol Bagley Amon sided with Heart, stating that the SEC did not establish a sufficient legal basis for its case.

The judge also found that Heart’s marketing efforts were globally available and not specifically directed at US investors. The SEC had claimed Heart extensively promoted his projects through websites and social media.

However, the court determined that simply providing information online does not constitute sufficient grounds for jurisdiction.

“Heart did not directly message US-based investors or respond to questions through his websites. Rather, Heart disseminated ‘how to’ information, which alone is not sufficient. Accordingly, Heart’s website contacts simply provided globally available information and lack sufficient interactivity to constitute a significant contact,” Judge Amon wrote.

Additionally, the judge ruled that the SEC failed to demonstrate that Heart’s alleged misconduct, including misappropriation of funds and deceptive transactions, took place within the US.

“The alleged misappropriation occurred through digital wallets and crypto asset platforms, none of which were alleged to have any connection with the United States,” the Judge ruled.

Meanwhile, the ruling also determined that even if the SEC had proven jurisdiction, its complaint lacked substantial evidence of domestic securities law violations. As a result, the case was dismissed.

“Even if the SEC had established personal jurisdiction over Heart, the Complaint cannot stand because it fails to adequately plead that either the transactions or conduct at issue were domestic under the federal securities laws,” Judge Amon stated.

HEX and PulseChain Surge Following Legal Victory

Reacting to the court’s decision, Heart described the ruling as a rare victory for the cryptocurrency industry.

He emphasized that HEX, PulseChain, and PulseX should be allowed to operate freely, stating that HEX has functioned without issue for over five years.

“This type of victory over the SEC is quite rare. PulseChain, PulseX and HEX are not securities and should be allowed to flourish. HEX has operated flawlessly for over 5 years. Today’s decision in favor of a cryptocurrency founder and his projects over the SEC brings welcome relief and opportunity to all cryptocurrencies,” Heart stated.

Following the decision, the tokens linked to Heart experienced massive price gains.

According to CoinGecko data, HEX gained over 77% in the past 24 hours, trading at $0.003979. Meanwhile, PulseChain rose more than 65% to approximately $0.01575 at press time.