The report revealed that some of the funds stolen from Crypto Assets exchange Poloniex were moved for the first time. Six months later, an account identified as receiving ill-gotten gains in November 2023 transferred $3.5 million to a Crypto Assets mixer.
First transfer of stolen assets
On Monday night, a flagged Address holding stolen assets transferred funds to Tornado Cash, a Crypto Assets mixer banned in the United States. This is the first time since the Crypto Assets theft incident that Hacker has transferred some of the funds for Money Laundering operations.
According to media reports, Poloniex exchange Hacker from Address 0x3E... fDFd transferred 100 ETH (worth about $308,000) to a Crypto Assets mixing service. Since then, PeckShieldAlert has issued a notification stating that the same Address sent another 1,100 Ether coin to Tornado Cash, with a total value of nearly $3.5 million.
In November 2023, the Poloniex exchanges, led by Justin Sun, suffered a security breach that resulted in the theft of $125 million in funds. Blockchain security firm PeckShield discovered and reported suspicious activity in the platform's Hot Wallet at the time. In response, the Poloniex team froze the accounts on the grounds of maintenance.
However, these efforts have proven futile, as Hacker has stolen millions of dollars worth of encryption assets from Address. According to the report, the exchanges lost $56 million on Ethereum (ETH), $48 million on TRON (TRX) and $18 million on Bitcoin (BTC). In addition, assets such as Pepe (PEPE) and Magic (MAGIC) were stolen.
encryption Hacker Ignore Warning
Tron founder and exchange owner Justin Sun initially offered Hacker a 5% white hat reward to encourage them to return encryption assets. Later, Sun raised the offer from about $6 million to $10 million, which is 10 percent of the industry standard.
Unfortunately, the attackers did not accept Sun's offer, despite Sun's clear statement that the assets would become useless. The Tron founder sent $0.10 worth of ETH to wallets that had already been identified, and those wallets had received the stolen funds.
In the message sent, Sun made it clear that these known Wallet Address had been marked as unqualified. He also issued a warning to investors that their accounts could be frozen if they traded with Addresses controlled by the Hacker. This is to stop the flow of stolen funds and ensure the safety of the accounts of users of the trading platform.
This behavior can be simply understood as tagging or "polluting" the attackers' wallets by sending small amounts of money to those wallets, making it difficult for the attacker to use or exchange the stolen funds without being detected. This is a common tactic used to stop the flow of stolen funds and may help law enforcement agencies track down and recover assets.
At the same time, it may also be sending a message to the attackers that the exchanges and security teams are actively responding to this security incident and that the stolen funds have been targeted.
The Hacker attack on the Poloniex exchanges has been attributed to the Lazarus Group, a North Korean Hacker group known for its high-profile cyberattacks. According to CoinGecko, the security breach greatly affected the Centralized Exchange's user trust, causing its trust score to drop from 10 out of 10 to 5.
Regulatory & Review Imminent
Recent money flows seem to indicate that the stolen funds are unlikely to be recovered, and that, according to analyst analysis, it is almost impossible to recover them. Even though attackers can't send encryption assets directly to exchanges, they use privacy tools to hide the traces of funds.
Notably, there are voices in regulators around the world who accuse these tools of being misused for criminal purposes, and use this as a reason to crack down on the privacy industry and increase scrutiny. However, even so, financial privacy is still extremely important to keep users safe, and the proper use of privacy protection tools can actually help better protect the interests of investors.
Ultimately, the increase in the number of Hacker attacks in the Crypto Assets space remains a concern for the community. In the first quarter of 2024, malicious actors stole more than half a billion dollars from Crypto Assets projects. Despite the sharp decline in April, experts are constantly urging Crypto Assets investors to be alert to any suspicious activity and strengthen their security measures.