2 weeks Ago
In a major breakthrough, Bybit has successfully frozen approximately $3.84 million worth of cryptocurrency stolen from a massive $1.4 billion Lazarus hack.
This decisive action highlights the exchange's commitment to combating crypto-related crime and protecting users' assets. The frozen funds represent a significant portion of the illicit assets, and Bybit's efforts may set a precedent for future cases. The money, initially 500,000 ETH, was laundered through a maze of mixers, cross-chain swaps, and decentralized platforms, rendering tracking efforts ever more challenging.
Zhou’s revelations highlight the growing challenges for crypto exchanges and investigators in recovering the stolen funds. More than 25 per cent of Stolen Funds Now Untraceable ByBit’s forensic analysis reports that 68.57 per cent of the stolen funds are still traceable, but 27.
59 per cent of assets have ‘gone dark.’ Bybit CEO Ben Zhou explained that it happened because the attackers split the funds and transferred them across different blockchain networks. These tactics have made it more difficult for investigators to track the funds, leaving them with scattered digital traces.
Funds Laundered Through Mixers and Cross-Chain Bridges The Pilfered money first went through Wasabi, a mixing service for cryptocurrencies, before being divided and laundered through services such as Tornado Cash and Railgun. The process involved cross-chain bridges such as Thorchain, and then eXch, after which tracing became much harder. Cash went to P2P and OTC websites, thereby extending the layer of fog.
Mass Conversion into Bitcoin: 342,975 ETH Converted to BTC ByBit monitored the conversion of about 432,748 ETH, representing 84.45 per cent of the initial theft amount, into 10,003 BTC received in 35,772 different wallets. Another 5,991 ETH, or 1.
17 per cent of stolen funds, is still on the Ethereum blockchain, spread across 12,490 wallets. Frozen Funds Represent Only 3.84 Per cent Though long-term tracking attempts have been extensive, a mere 3.
84 per cent of the pilfered funds were frozen. Zhou explained that even though certain assets were recovered with bounty programs, much still eludes capture since decentralized exchanges and mixers were used. Lazarus Group Heist Continues Apace Zhou urged the crypto community to join the bounty program, which has generated thousands of reports, but few were helpful.
Zhou stressed that it was still a long way to go in terms of investigation, as the stolen funds continued to circulate across different platforms. Most of the stolen cryptos are on-chain, but they are very fragmented. Recovery Still Possible Despite Hurdles While recovery is still challenging, Zhou was hopeful that the stolen money could still be recovered.
Two-thirds of the stolen assets remain traceable on-chain, albeit in a fragmented state. He urged concerted efforts from centralized exchanges , cross-chain platforms, and fiat gateways to assist in freezing additional assets. The Lazarus Group’s money is still actively flowing through decentralized networks, and while the process of recovery is complex, the battle to recover the stolen money continues.
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