April 19, 2024
THORSwap resumes with enhanced security measures after halting due to illicit fund detection.
Latest Cryptocurrency News

THORSwap Resumes Operations After Detecting Illicit Funds, Promises Enhanced Security

THORSwap, a decentralized exchange (DEX), has resumed its operations following a brief maintenance period prompted by the detection of illicit funds on its platform. THORSwap announced its return on X (formerly Twitter) on October 12, urging users to continue swapping over 5,500 assets across 10 blockchains from their self-custody wallets.

Initially, on October 6, the platform temporarily halted swaps as a preventive measure against the potential movement of illicit funds. The platform recognized the misuse of its DEX and paused operations to find a permanent solution. In the latest update, THORSwap has not introduced significant changes to its platform except for updated terms of service.

The revised terms of service, effective from October 11, now require users to adhere to applicable laws, including anti-money laundering regulations, and prohibit engagement in activities that violate sanctions programs or involve unlawful financial actions. The updated terms also empower THORSwap to restrict users from accessing its platform in case of violations, allowing them to terminate access without prior notice for any breach.

The cryptocurrency community expressed concerns about the revised terms, questioning THORSwap’s claim to decentralization in light of these new rules, which resemble those found on centralized exchanges.

Erik Voorhees, the founder of ShapeShift, differentiated THORSwap from THORChain, emphasizing that THORSwap is a centralized company making decisions about its interface, whereas THORChain is truly decentralized. Additionally, THORSwap announced a partnership with an industry leader to enhance protections against the flow of illicit funds, noting that further adjustments might be made in the days ahead.

THORSwap’s return coincided with a report from blockchain analytics firm Elliptic, which revealed that the hacker responsible for the now-defunct crypto exchange FTX had initiated a movement of the stolen funds in late September 2023. These transactions marked the first time the funds had been touched since the attack.

According to Elliptic, the anonymous hacker leveraged THORSwap to convert 72,500 ETH, equivalent to approximately $120 million, into Bitcoin before channeling the cryptocurrency through sanctioned mixers like Sinbad.

A THORSwap spokesperson assured that tracking the FTX exploiter’s funds is feasible once they have been converted to BTC. However, once funds have undergone mixing, they become untraceable.

Image by freepik

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