In a recent wave of cybercriminal activity, hackers successfully laundered $49.3 million worth of Ethereum in the first week of September 2024. According to on-chain data, the stolen cryptocurrency was funneled through Tornado Cash, a notorious crypto mixer that has been criticized for facilitating money laundering.
The funds, amounting to 20,561 ETH, were linked to four hacking incidents targeting various entities, including crypto exchange WazirX, DeFi protocols Penpie and LiFi, as well as crypto entrepreneur Bo Shen. Each of these attacks involved large sums of stolen Ethereum, and the hackers employed Tornado Cash to obscure the origins of their illicit funds.
Details of the Hacks
The most significant laundered amount came from the hacker who targeted Penpie, moving 11,261.2 ETH, equivalent to $26.72 million, in a single transaction. Penpie has since issued a 10% bounty offer to anyone who can assist in recovering the stolen assets. Despite this, the hacker showed no intention of returning the funds, unlike a previous hacker who returned stolen funds after targeting Euler Finance in 2023.
Meanwhile, the hacker responsible for the WazirX breach, which saw $230 million worth of ERC-20 tokens stolen, has taken a more gradual approach to laundering the stolen assets. This method has drawn attention due to the sheer size of the loot, which has complicated attempts to move it discreetly.
Impact on Ethereum’s Price
The coordinated laundering efforts have had a direct impact on the price of Ethereum. During the first week of September, Ethereum dropped by 13%, falling below $2,200. This made Ethereum the 18th worst-performing asset over the past 30 days, with the hackers’ sell pressure contributing significantly to the price decline.
Tornado Cash’s Continued Role in Crypto Crime
Despite being banned in the U.S., Tornado Cash continues to be a preferred tool for cybercriminals to hide their tracks. The crypto mixer has handled up to $1.8 billion in the first half of 2024, highlighting its resilience in the face of regulatory action. This latest wave of hacks has brought renewed scrutiny on the platform’s role in facilitating illegal transactions.
As WazirX and other affected platforms place bounties on the stolen funds, offering rewards to white-hat hackers, the crypto community remains on high alert. The use of Tornado Cash by malicious actors is once again in the spotlight, raising questions about the effectiveness of existing bans and security protocols in the cryptocurrency space.
