Binance Recovers Stolen, Disguised Crypto Loot From Mega Hack

More than a week after the U.S. tied one of the biggest heists in crypto to a North Korean hacking group, digital-asset exchange Binance said it was able to recover about $5.8 million worth of the stolen loot that had made its way onto its platform in disguised form. From a report: The details of how it achieved this serve as notice for those who attempt to cash out ill-gotten cryptocurrency gains: It may only get harder. The U.S. Treasury Department last week tied the North Korean hacking group Lazarus to the theft of more than $600 million in cryptocurrency from the Ronin software bridge, which is used by players of Axie Infinity to transfer crypto. The department identified an Ethereum wallet address tied to the group, adding it to its sanction list. Binance was able to trace stolen funds that were initially moved from the hackers' wallet to Tornado Cash -- a service that allows for anonymous token transfers on the Ethereum blockchain -- and then to its exchange by working with external firms.

Good

[gweihir]

The air for the scammers, thieves and extortionists is getting thinner. Any exchange that wants to stay in business will have to start doing this. And eventually, the only real business case for crapcoins (crime) will go away.

5.8 of $600 million

[algaeman]

Yeah, that'll definitely serve as notice to these guys. Notice that you may only be able to cash out 50%+ of your stolen goods.

Re:5.8 of $600 million

[Fallen Kell]

Well, I think the deterrent is of a different nature. It is showing that you don't actually own any crypto tokens if it at any point in time it "belonged" to someone else, because if in the chain of owners it happened to be owned by someone who did something like this and then you bought it afterwards, you are now the one to be potentially left without "ownership" as it gets transferred back to whoever owned it when it was "stolen".

Basically, its like a database is kept that tracks every piece of paper money and if that bill happened to have been stolen, the "government" can take it away from you and change it back to a previous owner, with no compensation to you because it is "stolen goods", but only makes those checks periodically, so someone else could have owned those bills, passed them hundreds of times, but since you were the one left with it when the "government" searched for them to reclaim, you are the stuckee with no recourse.

Re:

[ShanghaiBill]

For a small fee (about 1%), there are mixers/tumblers that will prevent that from happening.

Cryptcurrency tumbler [wikipedia.org]

Re: 5.8 of $600 million

[AvitarX]

Isn't tornado cash a mixer?

Re:

[ShanghaiBill]

Isn't tornado cash a mixer?

Yes, but only for ETH.

Re: 5.8 of $600 million

[AvitarX]

According to the summary they were able to follow money through tornado cash though, so I'm not sure mixers are truly untraceable.

Re:

[ShanghaiBill]

One possibility is that Tornado-Cash is run by the Feds.

The Feds also run many Tor entrance and exit nodes.

Re:

[h33t l4x0r]

It runs on-chain. You can read the contract code if you're interested.

Re:

[Powercntrl]

That Wikipedia article reads like it was written by someone who either doesn't understand how a tumbler works, or doesn't want to divulge specific details. The process described doesn't explain how it would actually break the traceability chain between "tainted" wallets.

Mostly, tumblers just seem like they're a scam to skim money from baddies who believe they're having their ill-gotten gains laundered. Actually laundering cryptocurrency would most likely require doing anonymous trades between various alt-

Re: 5.8 of $600 million

[lostmy4digitUID]

Ya all you do is distribute the lump sum of 1 crypto to 10 alt cryptos... and then move them around and consolidate somewhere else... if you choose to do so... just keep the assets moving until you cash out... they won't be able to keep up with you

Re:

[h33t l4x0r]

Right but only if you send it to a custodial wallet. You basically give Binance permission to help themselves to whatever they think you should not have.

It's also going to mean more market consolidation

[rsilvergun]

People aren't going to want to trade outside of the exchanges. Because what will happen is they'll trade cryptocurrency for their labor or goods or whatever outside the exchanges and then when they try to cash it out into real money using an exchange the crypto exchange will declare it stolen and seize it.

Once again cryptos become more like Central banking but a lot more expensive

Re:It's also going to mean more market consolidati

[h33t l4x0r]

This is a dumb hot take. It's more likely people won't want to trade inside exchanges since that's where their shit gets grabbed. Neither situation is likely though.

They're going to want fiat currency

[rsilvergun]

at some point. Crypto isn't going to take over the world. Google "petro dollar" sometime. If cypto ever actual challenged that system it would get real dead, real fast. Instead crypto, assuming it doesn't die under it's own weight (likely for reasons I'll cover below) will be integrated into that system.

See, there are other problems with crypto: the miners. Specifically they need a place to move their currency. That's the exchanges. They are going to trade currency for fiat cash so they can get those pe

Re:

[h33t l4x0r]

So about these bizarre misguided manifestos you like to post...? They're troublesome. We're going to need you to clear out your cubicle and work from home from now on.

Anytime you want to dispute any of my points

[rsilvergun]

you're welcome to. Go on. I'm waiting.

You're an idiot.

[mmell]

That is all.

Sure, *now* it's "worth" $600M, but ...

[fahrbot-bot]

What was the original purchase price, like $19.95?

Since when is 1% a good thing?

[dark.nebulae]

I'm sorry, but if I walked away with 594 million, I'd consider that 1% loss just the cost of doing business...

3 words

[Anonymous Coward]

Krypto Krime Koins

Binance is aggressive

[bill_mcgonigle]

I mean that in a sporting way. I watched them immediately start interacting with the heist wallet within hours (by sending it small txns). Methinks their Red Team knows some clever tricks that could be used for much worse purposes in other hands.

Something like the FBI would be starting weeks later.

Re:

[h33t l4x0r]

They don't explain how they're identifying the accounts. I think they're just seizing anything that came out of Tornado Cash around the time stolen coins went in.

So YOUR coins may have a stolen history!

[Fly Swatter]

If they decide that your coins were in the theft, which originally went though several wallets before getting to yours - are your coins now forfeit and you are now out your own money? How does this work?

Re:

[GlobalEcho]

If they decide that your coins were in the theft, which originally went though several wallets before getting to yours - are your coins now forfeit and you are now out your own money? How does this work?

It works however Binance wants it to work...there are no regulations. If it makes you nervous, you can either spend the time to verify the provenance of the tokens you accept into your wallet, or choose a different exchange that you believe will not have similar practices.

Just because some varieties of tokens are commonly labeled Non-Fungible does not mean other varieties of tokens are truly fungible.

Re:

[h33t l4x0r]

It as ETH not tokens unless I'm misunderstanding your meaning, sir.

Re

[MarkUltraBlack]

That's why it's necessary to develop decent platforms that are hard to hack. I mean, I'm pretty sure that this platform was built by great developers like kindgeek.com [kindgeek.com] or someone like that since it has to be highly secure, but I'm not sure that the hackers are just so skilled that they managed to get through the best security, there's room for development in that case.