Hackers laundered $35M from DMM Bitcoin through Huione Guarantee, linked to Cambodia’s ruling Hun family, amid cybersecurity concerns.
Elliptic reports Huione Guarantee processed $11B from various crypto scams, raising questions on regulatory oversight.
Tether’s blacklist of a Tron wallet linked to the DMM Bitcoin hack underscores ongoing challenges in crypto security.
Due to a serious vulnerability attack, hackers targeted DMM Bitcoin, a cryptocurrency exchange, at the end of May, resulting in a $305 million loss of Bitcoin. According to recent allegations, these hackers have subsequently used an internet marketplace in Cambodia to launder almost $35 million. According to cryptocurrency sleuth ZachXBT and blockchain forensics firm Elliptic, the laundered funds have been traced to Huione Guarantee, linked to Cambodia’s ruling Hun family.
1/4 So far in July 2024 more than $35M from the $305M DMM Bitcoin hack has been laundered to the online marketplace Huione Guarantee It is suspected that Lazarus Group is behind the hack due to similarities in laundering techniques and off chain indicators. pic.twitter.com/g1ndlttBll
— ZachXBT (@zachxbt) July 14, 2024
Elliptic’s findings reveal that Huione Guarantee, known for facilitating transactions involving crypto from various hacks and scams, including pig butchering schemes, has processed approximately $11 billion worth of such funds. ZachXBT suspects the involvement of Lazarus Group, citing similarities in laundering techniques and off-chain indicators.
Laundering Tactics and Financial Trails
The laundering process involves depositing stolen Bitcoin into privacy mixers, followed by withdrawals and bridging these funds across Ethereum or Avalanche using THORChain’s cross-chain liquidity protocol. Eventually, the funds are converted into USDT and then bridged to Tron before being transferred to Huione.
However, a significant obstacle arose when stablecoin issuer Tether blacklisted a specific Tron wallet address associated with the hackers on July 12, preventing the transfer of $28.2 million to Huione. This wallet had previously extracted around $14 million from the DMM Bitcoin hack within a short span of three days, as noted by ZachXBT.
TNVaKWQzau7xL9bcnvLmF9KSEQkWEs4Ug8Timestamp: 12.07.2024, 23:21:36 UTCEvent: AddedBlackListBalance: 28,257,162.94 USDT (TRC20)https://t.co/Whl97I1K7m
— USDT/USDC Ban List (@USDTBanList) July 12, 2024
Impact on Centralized Exchanges
In response to the attack, DMM Bitcoin swiftly raised $320 million in funds to compensate affected users. Despite this, over $1.4 billion in cryptocurrencies has been stolen in 2024 alone, highlighting the Penetrating threat posed by cybercriminals targeting centralized exchanges.
According to Cyvers, a blockchain security company, losses from centralized exchanges have increased by 900% in the last 12 months. Particularly this quarter, there has been a change in that decentralized finance (DeFi) protocols have demonstrated increased resilience, whereas centralized exchanges have been hit harder by significant occurrences.
The event highlights the weaknesses in centralized exchanges and the difficulties they encounter in protecting user assets from advanced hackers. Even with initiatives to improve security, including quick fundraising after a hack, the frequency and severity of these events still have a big effect on the cryptocurrency market.
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