June 4, 2024
Hacker Shifts $3.7M to Tornado Cash as Ether Soars
Altcoins News

Hacker Shifts $3.7M to Tornado Cash as Ether Soars

The hacker responsible for the $25 million Kronos Research exploit has made another significant move, transferring $2.6 million worth of Ether to the cryptocurrency mixing service Tornado Cash. This transfer, which amounted to 700 Ether (ETH), was reported by the on-chain security firm PeckShield on May 21.

Source: PeckShield

Details of the Transfer

The hacker’s wallet, identified as “0x3,” has been active over the past few days. On May 20, three transactions of 100 Ether each were sent, followed by seven additional transactions of 100 ETH on May 21. This series of transfers totals 1,000 Ether, valued at over $3.7 million at the current price. Despite these transfers, the hacker’s wallet still holds a little over 60 ETH, worth more than $223,000. At its peak on May 19, the hacker’s wallet was valued at over $6.4 million, according to CoinStats data.

Source: Coinstats

Ether Price Surge

The hacker’s decision to move the funds coincides with a significant surge in Ether’s price. Over the past 24 hours, Ether’s price has increased by more than 20%, reaching $3,744 as of 11:14 am UTC. This marks the first time Ether has traded above $3,700 since March 15, as per CoinMarketCap.

SEC’s Potential U-Turn Boosts Ether

The recent rally in Ether’s price has been partly attributed to reports suggesting a potential U-turn by the United States Securities and Exchange Commission (SEC) on spot Ether ETFs. It is reported that the SEC, possibly under political pressure, has asked ETF exchanges to update their 19b-4 filings. Adding to the positive sentiment, Bloomberg senior ETF analyst Eric Balchunas has raised the probability of approval from 25% to 75%.

Use of Tornado Cash

Crypto mixing protocols like Tornado Cash are often used to obscure the origins of cryptocurrency transactions, making it challenging to trace the source of funds. Such services are commonly utilized by hackers and exploiters to launder illicitly obtained crypto assets.

Previous Transfers

This recent activity follows a transfer on May 7, when the Kronos Research hacker moved 1,314 Ether worth over $4 million to Tornado Cash. These moves indicate a strategic approach to laundering the stolen funds following Ether’s price surge.

The Kronos Research Exploit

Kronos Research was targeted in November 2023 when exploiters gained access to the firm’s application programming interface (API) keys. Initially, Kronos denied any loss of funds in its early announcements. However, on-chain investigator ZachXBT later revealed that approximately 12,800 ETH, worth $25 million, had been stolen and transferred to six unique crypto wallet addresses. Following this revelation, Kronos Capital halted its trading services to conduct a thorough investigation into the loss.

Conclusion 

The hacker’s $3.7 million transfer to Tornado Cash amid Ether’s surge highlights ongoing challenges in combating crypto-related illicit activities. This strategic move raises questions about the effectiveness of current regulatory measures in preventing money laundering and safeguarding digital assets.

Image by freepik

Disclosure Statement: Miami Crypto does not take any external funding, or support to bring crypto news to the readers. We do not have any conflicts of interest while writing news stories on Miami Crypto.

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