Blockchain Surveillance Firm Elliptic Suggests Russian-Linked Entity as FTX Hacker
According to blockchain surveillance company Elliptic, there is now a stronger possibility that the mysterious hacker behind the FTX exchange breach is connected to Russia. One of the main reasons for this is that funds were moved while FTX founder Sam Bankman-Fried was in a Manhattan courtroom, which casts doubt on the theory that he stole the money. Elliptic provided a timeline detailing the movements of the stolen funds, revealing that much of the proceeds were converted into Bitcoin and passed through ChipMixer, an unlicensed Bitcoin privacy mixer shut down by the Justice Department earlier this year. The stolen assets were then combined with funds from Russia-linked criminal groups before being sent to exchanges, suggesting the involvement of a broker or intermediary with ties to Russia.
The FTX Exchange Hack and Money Laundering Techniques
Last November, on the same day that FTX filed for bankruptcy, it lost 9,500 Ethereum (ETH) to an unknown hacker who transferred the assets to a new address. The hacker later claimed $477 million worth of various cryptocurrencies including Pax Gold (PAXG), Tether (USDT), and Wrapped Bitcoin (WBTC). While some funds were frozen due to regulatory compliance, most were successfully swapped for other cryptocurrencies and moved across different blockchains in order to break the trail and make it harder to trace. Hackers used services such as RenBridge and THORSwap to convert Ethereum into Bitcoin. After ChipMixer was shut down, funds were mixed through Sinbad, which Elliptic believes is a rebrand of Blender—a mixer previously sanctioned by the US Treasury Department for aiding North Korean hackers.
Lazarus Group Connection
Despite the use of Sinbad, Elliptic does not believe that the Lazarus Group, a North Korean hacking group, is responsible for the FTX hack. Elliptic argues that the hacker’s money laundering methods were relatively unsophisticated compared to the Lazarus Group’s techniques. While there is a connection between Sinbad and Blender, Elliptic does not believe this indicates Lazarus Group involvement in the FTX breach.
Hot Take: Russian Connection Suggests Broader Cybersecurity Concerns
The possibility of a Russian-linked entity being behind the FTX exchange hack raises broader concerns about cybersecurity and criminal activities in the crypto space. It highlights the need for increased vigilance and regulatory measures to prevent such incidents in the future. As cryptocurrencies continue to gain popularity and value, it is crucial for individuals and organizations to prioritize security and take necessary precautions to safeguard their digital assets.
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