$16 Million Exploit: Coinbase Commerce Breached

A fraudster known as "Excite" has gained attention after exploiting a flaw in Coinbase Commerce, stealing nearly $16 million. The exploit involved 1,700 transactions on the Polygon layer-2 network, allowing the attacker to convert stolen USDC from Polygon to Ethereum.

How the Attack Was Executed

The perpetrators employed a common tactic: splitting stolen funds across multiple wallets to obscure blockchain tracking. According to blockchain investigator ZachXBT, most of the stolen funds remain inactive, but some were funneled into crypto gambling platforms like eXch and Stake.

Boasting on Social Media

In May, a Telegram user with the handle "tezedasads12" claimed ownership of a wallet holding $6 million from the hack. This individual also took credit for managing the Instagram account "Excite," where they flaunted a lavish lifestyle, including a pet monkey and expensive watches allegedly purchased in Denmark with stolen funds.

Questions About Coinbase's Security

ZachXBT raised concerns about why Coinbase's Anti-Money Laundering (AML) monitoring system failed to flag the suspicious activity during the 16-hour window when the exploit occurred. There is also speculation that more individuals may have been involved, as the funds were divided in multiple ways.

Other Discovered Heists

This is not the first case uncovered by ZachXBT. In November, he revealed a $6.5 million theft from Coinbase users, allegedly orchestrated by a scammer named Ronald Spektor. Shortly after the report, Spektor deactivated his social media accounts, fueling suspicions of his involvement.

ZachXBT also assisted an elderly victim in recovering $275,000 lost to Indian scammers posing as Coinbase support staff.

Major Arrests Thanks to Investigations

ZachXBT's investigations have led to significant arrests, including a $238 million crypto heist. This case involved scammers impersonating Coinbase support agents to defraud Genesis lender, stealing 4,064 BTC, as reported in August.

Conclusion

This case highlights severe security vulnerabilities in the crypto space, showing that even major platforms like Coinbase are not immune to sophisticated attacks. ZachXBT plays a crucial role in uncovering these crimes and helping victims recover their funds.

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