WazirX crypto hacker nearly finished laundering funds
The crypto crook behind the $230M WazirX hack in July 2024 has almost finished the money laundering process of cleansing the funds via Tornado Cash. Only $6M of Ether (ETH) remains to be laundered.
In August, the hacker laundered $50M via Tornado, increasing his activities throughout September. On Wednesday September 25 alone, the hacker transferred $10M worth of ETH to a new wallet.
Crystal Intelligence was able to trace the funds and analyze the complex laundering scheme adopted by the criminals behind the WazirX hack.
As the investigation progressed and more transactions were traced, new layers of complexity were uncovered, further highlighting the sophistication of this operation.
Crystal’s analysis highlighted the repetitive nature of the laundering patterns observed. Executed hundreds of times, they strongly suggest that the process was automated in a calculated attempt to flood the network with transactions, therefore obscuring the illicit trail.
Despite efforts to complicate the tracing process with numerous transactions, blockchain analysis remains effective with the right tools, techniques, determination, and patience. By carefully analyzing each stage, it’s possible to uncover the path taken by the laundered funds, even amidst apparent chaos. This case serves as a reminder that transparency is still attainable through cutting-edge technology and a systematic approach.
WazirX has allegedly lost more than 45% of its overall reserves and is being criticized for its handling of the crisis, with efforts to recover the stolen funds faltering. Meanwhile, the Tornado Cash developer Alexey Pertsev was convicted of money laundering in the Netherlands in May 2024, and sentenced to five years and four months in prison.
Find out more about this story at CoinDesk.
FTX ex-CEO’s ex jailed for crypto fraud complicity
A Manhattan US District Court sentenced Ms. Caroline Ellison to 24 months in prison for her role in facilitating her on/off boyfriend, Sam Bankman-Fried, in defrauding crypto investors of about $8B in customers’ funds.
In court, it was heard that the fraud itself, which was described as one of the worst financial crimes in history, cost investors billions of dollars within a matter of days in November 2022. Ms. Ellison’s lawyers contended that she was manipulated and knew a disaster was approaching, but felt a break-up would accelerate the inevitable result.
The courts granted her grace for agreeing to give evidence against Mr. Bankman-Fried, who is facing 25 years in prison for the fraud which left thousands out of pocket when it spectacularly collapsed in November 2022.
Find out more about this story at News.com.
Taiwan authorities to allow professional investment in foreign virtual asset ETFs
The Taiwan Financial Supervisory Commission (FSC), in consultation with the Securities Business Association of the Republic of China, picked out five key points in allowing professional investors to invest in foreign virtual asset exchange-traded funds (ETFs):
- They must be professional investors.
- Firms must assess and vet the clients’ suitability for investing in the product.
- The client must assent to the relative investment risks by signing a ‘risk warning letter.’
- Firms should provide virtual asset ETF product information to prospective first-time clients.
- Firms must be obliged to constantly update the knowledge base of their business personnel.
Meanwhile, the FSC will continue to monitor the situation.
Find out more about this story at FSC.gov.tw.
UK FCA convicts first illegal crypto ATM culprit
The UK’s Financial Conduct Authority (FCA) achieved its first conviction under anti-money laundering laws on Monday, September 30, 2024. Olumide Osunyaka was convicted of running an illegal crypto ATM system throughout the UK.
The network consisted of at least eleven crypto ATMs that processed over $3.5M in crypto transactions between December 29, 2021, and September 08, 2023. Since no customer due diligence or ‘origin of funds’ checks were undertaken, the machines are thought to have been used by thieves seeking to launder funds and dodge taxes.
Authorities also noted that Osunyaka continued to develop and grow his crypto ATM network after being refused registration in 2021, and attempted to throw authorities off the scent by falsely claiming to have sold the enterprise to a ‘fictitious individual’. He faces up to 14 years in prison upon sentencing.
Find out more about this story at Bitcoin.com.
UAE adds disclaimer rule for crypto firms seeking new clients
The United Arab Emirates’ (UAE) Virtual Assets Regulatory Authority (VARA) has made a new rule that will require crypto training entities to provide customers with warnings about the risks of investing in virtual assets.
The disclaimer now expected of UAE crypto businesses comes when Dubai, in particular, has created a favorable climate for crypto businesses through tax breaks and ‘venture capital prospects.’
As many as 500,000 crypto traders call the Middle East home, exploiting the sympathetic laws governing virtual asset trading. The number is expected to increase to 700,000 by the end of 2024.
Find out more about this story at Crypto News.
