The recent plummet in Ethereum‘s price has presented a ripe opportunity for hackers holding stolen funds to make significant purchases at a discount. On August 5, amidst a sharp 20% drop in Ether’s value, hackers who had previously attacked the crypto bridge Nomad in August 2022, utilized their illicit gains to buy Ether on the cheap.
According to blockchain analytics firm Lookonchain, these hackers deployed 39.75 million stolen Dai tokens to purchase 16,892 ETH when its price fell from about $2,760 to $2,172 within a span of just 12 hours. This data was corroborated by market insights from Cointelegraph Markets Pro and TradingView. Following this considerable acquisition, the hackers promptly began transferring the newly purchased Ether to Tornado Cash, a crypto mixing service known for its role in obfuscating the origins of cryptocurrency holdings.
Tornado Cash: A Tool for Anonymity
Crypto mixers like Tornado Cash are frequently utilized by cybercriminals to enhance the anonymity of illicit funds. Such services disrupt the traceability of digital assets on the blockchain, making it challenging for authorities to track and recover stolen funds.
Additional Hacker Activities
In parallel developments noted by blockchain investigation firm PeckShield, the Nomad bridge exploiter also transferred 17.75 ETH to an intermediary Ethereum address. Subsequently, approximately 2,400 ETH, valued around $7 million, was funneled into Tornado Cash. This suggests a systematic approach to laundering stolen cryptocurrency.
The downturn in the crypto market has not only affected Ethereum but has also triggered movements of stolen funds from other hacks. For instance, funds from the Pancake Bunny hack, a DeFi protocol on the BNB Smart Chain compromised by a flash loan attack in 2021, were also noted to be on the move. Interestingly, a mishap occurred when 3.6 million DAI was reportedly sent “by mistake” to a stablecoin address, illustrating the potential pitfalls and complexities involved in managing digital assets.
| Date | Event | Amount Involved | Details |
|---|---|---|---|
| Aug 5, 2022 | Purchase of ETH with stolen DAI | 16,892 ETH | Part of funds linked to Nomad hack |
| Jul 8, 2023 | Siphoning of ETH through Tornado Cash | $2.9 million | Linked to the Pancake Bunny hacker |
The incidents underscore ongoing security challenges within the cryptocurrency landscape. Sending crypto to unsupported or incorrect addresses can lead to irreversible losses, a risk that becomes pronounced amid the chaos of market crashes and the actions of opportunistic hackers.
As the cryptocurrency market continues to navigate through periods of intense volatility, the activities of hackers remain a significant concern. These entities exploit downturns not only to secure assets at lower prices but also to launder and redistribute stolen funds across various platforms, complicating efforts to clamp down on cybercrime within the blockchain ecosystem.
Featured image credit: jcomp via Freepik
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