US Hacker Sentenced to Three Years in Prison for Crypto Theft
An American hacker has been sentenced to three years in prison for stealing over $12 million in cryptocurrency from two decentralized exchanges (DEXs). The hacker, Shakeeb Ahmed, a security engineer, used fraudulent pricing data to exploit vulnerabilities in the DEXsโ systems and siphon off the digital assets.
Hackerโs Exploits
Here are the details of the hackerโs exploits:
- In July 2022, Ahmed manipulated pricing data on an unnamed DEX to generate $9 million in inflated fees, which he then withdrew in the form of cryptocurrency.
- He agreed to return most of the stolen funds, except for $1.5 million, in exchange for the DEX not reporting the attack to law enforcement.
- Later that month, Ahmed targeted Nirvana Finance, another DEX, by exploiting vulnerabilities in its smart contracts to purchase undervalued crypto assets and resell them at a higher price, netting $3.6 million.
Legal Ramifications
The consequences for Ahmedโs actions include:
- A three-year prison sentence for computer fraud
- Three years of supervised release
- Forfeiture of approximately $12.3 million and a substantial amount of cryptocurrency
- $5 million in restitution to the affected DEXs
- The prosecution marks the first conviction for hacking a smart contract, setting a precedent for future cases.
Law Enforcementโs Response
Damian Williams, the US Attorney for the Southern District of New York, emphasized the governmentโs commitment to pursuing hackers and holding them accountable for their actions.
โNo matter how novel or sophisticated the hack, this Office and our law enforcement partners are committed to following the money and bringing hackers to justice. And as todayโs sentence shows, time in prison โ and forfeiture of all the stolen crypto โ is the inevitable consequence of such destructive hacks.โ
Closing Thoughts on Cybercrime in the Crypto Space
Cybercriminals continue to target cryptocurrency platforms for financial gain, exploiting vulnerabilities and loopholes in decentralized systems. As the crypto industry evolves and matures, law enforcement agencies are stepping up their efforts to combat cybercrime and hold perpetrators accountable for their actions. The sentencing of the US hacker serves as a stark reminder that illegal activities in the digital asset space will not go unpunished.
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