The trial of FTX founder Sam Bankman-Fried is currently underway, and it seems that the anonymous hackers who targeted the now-defunct exchange are taking advantage of the situation. According to blockchain analytics firm Elliptic, large amounts of stolen assets from FTX have recently been on the move.
Specifically, 72,500 Ether (ETH) of stolen assets from FTX, which had been dormant since the exchange was hacked in November 2022, have suddenly become active. Elliptic reported this development on October 12.
Since September 30, 2023, the thief has converted $120 million worth of ETH into Bitcoin (BTC) using a multichain decentralized exchange (DEX) called THORSwap. These conversions began just a few days before Bankman-Fried’s trial started on October 3. At the time of the hack, the converted amount was worth $87 million, or 18% of the total stolen funds amounting to $477 million.
It appears that the FTX hacker is using a similar money laundering technique to the one used in November 2022. Back then, the hacker had transferred 65,000 ETH ($100 million) to BTC using a cross-chain bridge known as RenBridge.
According to Elliptic, “The 180,000 ETH that was not converted to Bitcoin through RenBridge remained dormant until the early hours of Sep. 30, 2023 — by which time it was worth $300 million.”
It is worth noting that the FTX hacker lost $94 million in the days following the hack as they hurried to launder the funds through decentralized exchanges, cross-chain bridges, and mixers.
Interestingly, almost a year after the hack, the identity of the FTX thief remains unknown. Elliptic suggests three possible culprits: an insider job at FTX, North Korea’s Lazarus Group, or Russia-linked criminal groups.
Elliptic speculates that FTX employees could have had access to the exchange’s crypto assets and may have moved them for operational reasons. It is possible that amidst the chaos surrounding the company’s bankruptcy and collapse, an internal actor took advantage of the situation.
The FTX hack serves as a reminder of the vulnerabilities in the cryptocurrency industry. Despite the advancements in blockchain technology, hackers continue to find ways to exploit weaknesses in security systems. This incident also highlights the importance of robust security measures and thorough investigations to identify and bring these criminals to justice.
As Bankman-Fried’s trial unfolds, it remains to be seen what impact these recent transactions involving stolen assets will have on the proceedings. The trial will not only shed light on the hacker’s motives and methods but also determine the legal consequences for Bankman-Fried, assuming he is found guilty of any wrongdoing.
In the meantime, the hunt for the FTX thief continues, and efforts are being made to track and recover the stolen assets. The outcome of this case will have far-reaching implications for the crypto industry and its ability to provide secure and trustworthy platforms for users.
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