Kraken, the San Francisco-based cryptocurrency exchange, is taking a hardline stance against a criminal extortion attempt, refusing to pay after two support staff members were found to have accessed customer data without authorization. The attackers threatened to broadcast the breach to news outlets and social media if the exchange failed to provide money, a demand Kraken's Chief Security Officer Nick Percoco publicly rejected in a post on X detailing how the incidents were discovered and handled.
Globally, law enforcement is making strides against bitcoin theft. Large-scale cryptocurrency fraud was the target of Operation Atlantic, a coordinated effort by US, UK, and Canadian agencies.
Over $45 million in stolen money was found during the operation, and about $12 million of it was frozen.
The week-long effort focused on a tactic known as approval phishing, which is used in so-called “pig butchering” scams.
In these schemes, victims are manipulated into handing over full control of their crypto wallets to scammers.
Investigators identified more than 20,000 compromised wallet addresses spread across 30 countries and took down over 120 fake websites used in the scams.
Separately, the US government announced the seizure of more than $14 billion in Bitcoin tied to a criminal network based in Cambodia.
Even if those victories are noteworthy, events outside of the cryptocurrency space have been hurting the overall market.
Following the collapse of peace talks between the United States and Iran in Islamabad, Pakistan, Bitcoin plunged below $70,000. Investors were alarmed by the breakdown, which led to a sell-off that destroyed almost $350 million in long bets.
Tensions rose further when President Donald Trump threatened to block the Strait of Hormuz, a move that sent Bitcoin down 3% in just two hours.
Adding to the pressure, the US Consumer Price Index climbed to 3.3% in March.
Some analysts warn that if the conflict deepens, inflation could hit 4%, which would likely push the Federal Reserve to hold off on cutting interest rates.
Oil prices have also climbed to $84 per barrel, adding to the gloomy outlook. A recovery in crypto markets, experts say, will depend on a ceasefire, oil prices falling back below $80, and better economic figures coming through.
For now, big investors are sitting on their hands, with money flowing into Bitcoin exchange-traded funds largely stalled.
The combination of high-stakes geopolitics and insider exploitation shows that the biggest weaknesses in cryptocurrency are still human-centric rather than solely algorithmic.
Bitcoin’s price stability is now linked to both network security and international diplomacy as it increasingly resembles traditional macro assets.
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