Exploring Recent Movements of Almost $1 Million in Ethereum to Tornado Cash
Recently, wallets connected to the CoinStats exploit have seen an inflow of nearly $1 million in Ether being moved into Tornado Cash, a contentious crypto mixing platform. This significant transaction has raised eyebrows within the cryptocurrency community, especially considering the ongoing investigations into the security breach.
- Wallets associated with the CoinStats exploit moved a total of 311 ETH, equivalent to about $959,000, to Tornado Cash.
- One wallet transferred 211 ETH, while the other moved 100 ETH into the crypto mixer.
The security breach, which was reported by CoinStats on June 22nd, affected iOS users who received a deceptive notification promising a reward. Despite this incident, the company swiftly responded by suspending its application to mitigate the breach. It was confirmed that only 1.3% of their total wallets, totaling 1,590 accounts, were affected. CoinStats reassured users that their connected wallets and centralized exchanges (CEXes) remained secure.
In a recent update on July 5th, CoinStats mentioned that the security incident is still under investigation, with no details released regarding potential involvement of law enforcement authorities.
“We are still investigating the security incident on June 22 and taking rapid and committed actions to ensure the security of our new infrastructure. We are working hard to share additional information as soon as we can, including measures to support any victims.”
Legal Challenges Surrounding Tornado Cash Developers
Despite facing legal hurdles and crackdowns, Tornado Cash remains a popular choice for laundering illicitly obtained funds. In August 2022, the US Department of the Treasury imposed sanctions on the service, prohibiting its usage by US citizens, residents, and companies. Consequently, the project’s web domain and GitHub accounts were shut down.
- In the same month, Tornado Cash developer Alexey Pertsev was arrested in Amsterdam on suspicions of involvement in concealing criminal financial flows and aiding money laundering through the Ethereum mixing service.
- Pertsev was subsequently sentenced to 5 years and 4 months in prison in May.
- Following these events, two other Tornado developers, Roman Storm and Roman Semenov, were accused of facilitating $1 billion in money laundering. Storm was apprehended in Washington State.
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