Bitcoin developer Ben Allen has received a $100,000 grant from investment firm Maelstrom to support the development of Payjoin, a privacy-focused tool aimed at improving Bitcoin’s scalability and privacy.

According to a May 20 announcement shared with Cointelegraph, Maelstrom will finance Allen’s work on his Payjoin devkit alongside Dan Gould. The system allows Bitcoin (BTC) senders and receivers to use batched transactions, with positive implications for scalability and privacy.

Payjoin Developer Kit’s website. Source: Payjoin Dev Kit

Payjoin was first proposed by Nicolas Dorier in 2019 in Bitcoin improvement proposal (BIP) 78. The core principle behind the system is that both senders and receivers may contribute inputs to a transaction.

“Namely that privacy is enhanced and improved consolidation of transaction outputs is achieved, benefiting scalability,“ the Maelstrom announcement states.

A Maelstrom representative told Cointelegraph that grantees are paid monthly for a total of $100,000 per year in Bitcoin and Allen’s grant will last one year. There are no concrete milestones and the grant is managed on a hands-off approach:

“We believe grantees may work better with freedom to work on what they wish, rather than being tightly controlled by those who provide the funding.“

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Payjoin: Soon in wallets near you?

Allen will be working on improving Payjoin implementations, with the clear objective of making it possible for the feature to be added to more wallets. He explained that the funding will enable him to work on the project full time.

The announcement points out that the system presents challenges, with the receiver needing to be online and the payment communication flow being more complex than normal non-interactive Bitcoin transactions. Maelstrom’s chief investment officer and BitMEX crypto exchange co-founder and former CEO Arthur Hayes said that “improving financial privacy in Bitcoin is extremely important.” He added:

“The great thing about Payjoin is that if only a small amount of adoption is achieved, it breaks a key assumption used by financial surveillance companies. The assumption they have is that if a Bitcoin transaction has multiple inputs, all the inputs must all belong to the same entity.“

A Maelstrom representative explained to Cointelegraph that the firm “is keen to support more grantees in the privacy area.” The company is actively seeking candidates with strong track records in Bitcoin privacy projects.

Related: What are privacy coins and how do they differ from Bitcoin?

Enjoy the benefits whether you use it or not

Hayes noted that “Payjoin adoption improves the privacy of even the people who don’t use it.” Allen said he believes privacy is important for Bitcoin users to enjoy a better experience and control their financial data when using it daily.

Allen told Cointelegraph he is “building out benchmarks to help downstream developers implement Payjoin in individual wallet software as well as expanding test coverage to ensure consistent and reproducible code.” He explained that encouraging its adoption “is the biggest step we can take for simplifying the experience and encouraging Payjoin adoption by moving the complexities mostly away from the user.”

The Maelstrom representative told Cointelegraph that “a key metric for Payjoin success would be adoption by popular open source Bitcoin wallets.” “In particular if the BitcoinCore wallet ever adopts it, that would be a huge signal of success,” they added.

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Binance has filed a motion to dismiss a $1.76 billion lawsuit brought by the FTX estate, accusing the defunct crypto exchange of trying to deflect blame for its own failure.

Filed on May 16 in the Delaware Bankruptcy Court, Binance’s legal team called the suit “legally deficient,” stating that FTX’s collapse was not triggered by market manipulation or hostile action but by internal misconduct.

“Plaintiffs are pretending that FTX did not collapse as the result of one of the most massive corporate frauds in history,” the filing said, pointing to Sam “SBF” Bankman-Fried’s conviction on seven counts of fraud and conspiracy.

FTX’s estate alleges that Binance received billions in crypto during a 2021 buyback deal, funded improperly with customer assets.

Binance rejects this claim, stating that “FTX remained a going concern for 16 months” after the share repurchase and that there was “no plausible claim” the exchange was insolvent at the time.

Binance filing to dismiss FTX’s lawsuit against the exchange. Source: Law360news

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Zhao’s tweet and FTT crash

The lawsuit also accuses former Binance CEO Changpeng Zhao of triggering a collapse through a tweet on Nov. 6, 2022 announcing the liquidation of FTT tokens.

In response, Binance argued that Zhao’s tweet was based on publicly known concerns. “Binance’s decision to liquidate its remaining FTT was, in fact, ‘due to recent revelations ’— in particular, the Nov. 2, 2022, CoinDesk article” that exposed Alameda Research’s balance sheet.

The company further defended Zhao’s comment that Binance would aim to minimize market impact. “The Complaint contains no such facts” to prove Binance had no intention of following through.

CZ announced plans to liquidate FTT holdings in 2022. Source: CZ

In challenging the court’s jurisdiction, Binance said none of the foreign entities named “are incorporated in or maintain their principal place of business in the United States,” and thus fall outside the court’s reach.

The filing also criticizes the plaintiff’s narrative as “a grab bag of state law claims” based on “pure conjecture — much of it sourced from a convicted fraudster’s hindsight speculation.”

Binance has asked the court to dismiss all claims with prejudice. The FTX estate has not yet filed its response.

Related: FTX EU creditors can now withdraw money from Backpack exchange

FTX to disburse $5 billion in second round of creditor repayments

FTX is set to begin its second round of repayments to creditors more than two years after filing for bankruptcy.

In a May 15 notice, the FTX Recovery Trust announced that over $5 billion will be distributed starting May 30 through BitGo and Kraken, targeting parties in the second eligible group under the exchange’s reorganization plan.

According to the plan, five creditor groups categorized as “convenience classes” are expected to receive between 54% and 120% of their claims. In total, FTX may repay up to $16 billion, depending on the final number of valid claims.

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A recent data breach at crypto exchange Coinbase has raised concerns about user safety after hackers gained access to sensitive information, including home addresses.

Coinbase, the world’s third-largest cryptocurrency exchange, confirmed that less than 1% of its transacting monthly users were affected in an attack that may cost the exchange up to $400 million in reimbursement expenses, Cointelegraph reported on May 15.

However, the “human cost” of this data breach may be much higher for users, according to Michael Arrington, the founder of TechCrunch and Arrington Capital.

“Very disappointed in Coinbase right now. Using the cheapest option for customer service has its price,” Arrington said in a May 20 X post, adding:

“Something that has to be said though – this hack – which includes home addresses and account balances – will lead to people dying. It probably has already.”Source: Michael Arrington

While no passwords, private keys or account funds were exposed, cybercriminals reportedly bribed overseas customer service contractors to access internal systems. This allowed them to steal personal data that could be used in social engineering scams or even physical extortion attempts.

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With Bitcoin (BTC) trading above $100,000, crypto wealth has become a growing target for criminals. Experts warn that leaked address data could expose high-net-worth individuals to real-world risks.

On May 16, Cointelegraph reported on six violent robberies that targeted cryptocurrency investors, aiming to extort digital assets via kidnapping or torture.

In a ruthless attack on May 4, the father of a French crypto entrepreneur was abducted in Paris, France. The kidnappers cut the victim’s finger and sent a video to his son, demanding 5 million euros in crypto.

The victim was held for two days before French police were able to find and rescue him. According to CNN, five people were arrested in connection with the kidnapping. 

Related: US crypto funds top $7.5B inflows in 2025 as investor appetite grows

Crypto exchanges need “layered” cybersecurity

To prevent similar user data breaches, crypto exchanges need to adopt a “layered defense strategy,” according to Ronghui Gu, the co-founder of CertiK Web3 security firm.

“This can include privileged access management, zero trust architecture, multifactor authentication across internal systems, and continuous monitoring with behavioral analytics,” Gu told Cointelegraph, adding: 

“Preventive measures such as regular phishing simulations, tailored security training, and restricting third-party access to sensitive systems may help reduce these risks.”

However, crypto platforms will need to “rethink their security posture” as attackers “increasingly target human vulnerabilities rather than technical ones,” added Gu, warning of the rising threat of social engineering schemes.

Incidents and losses in 2024 by month. Source: CertiK

Social engineering schemes, such as phishing scams, were the most significant security threat of 2024, costing the industry over $1 billion across 296 incidents, according to CertiK.

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