The hacker who drained WazirX moved to further launder the hacked cryptocurrency, transferring around 1,600 ETH valued at about $3.8 million to crypto mixer service Tornado Cash through a string of rapid transactions.
5,000 ETH Transferred to New Wallet
Blockchain security watchdog PeckShieldAlert said the attacker sent 5,000 ETH, worth some $12 million at today’s prices, to a new wallet whose first and last bytes are “0x2…968.” This is the latest in a spate of multimillion-dollar transactions the hacker has been conducting in an apparent attempt to obscure the origin of the money. In less than half an hour, 1,600 ETH streamed into Tornado Cash.
Tornado Cash: A Controversial Mixing Service
Thus, Tornado Cash has gained a considerable amount of notoriety for money laundering totaling billions of dollars in crypto assets since 2019, regulators say, including $7 billion in illegal funds the service has helped to conceal. The mixing service works by pooling users’ funds and obscuring their transaction paths, making it tough for anyone to trace where the crypto ends up.
Rapid Laundering in Batches
The pattern of laundering of the hacker hasn’t changed, as it moved the hacked Ethereum block by block, 100 ETH in every transaction. There were a total of 16 transfers of 100 ETH each in this recent laundering spree. Presently, the balance with the exploiter in the new wallet is approximately 3,400 ETH ($8.19 million).
That is close to the earlier laundering that occurred on September 2, where the attacker laundered an additional 2,600 ETH worth $6.5 million using the same crypto mixer. In both cases, the hacker used the services of a virtual cash laundering service known as Tornado Cash to break the tracking trail of the money.
Total ETH Laundered: Over $10 Million
In all, considering the latest developments, the hacker has already laundered 4,200 ETH, which, at the current market price, has a value of $10.11 million. Due to the anonymizing features of the Tornado Cash mixer, it is not clear exactly what the hacker is doing with the money and where it will end up.
Response by WazirX and Customer Grievances
First hacked on July 18, WazirX lost a record $235 million. The exploit not only brought WazirX down to its knees but made the exchange enter into a Singapore Scheme of Arrangement-a formal restructuring procedure intended to protect the business from insolvency under Singapore’s regulations.
The gradual withdrawal system adopted by the exchange, since the hack, has drawn complaints from WazirX users. By August 26th, customers could only withdraw 66% of their funds, which many felt was not enough. Complaints flooded social media platforms, with some users questioning when cryptocurrency withdrawals would resume.
What’s Next for WazirX?
While the exploiter remains on the lam, still using Tornado Cash to move the money, the future of WazirX is in limbo. WazirX is now in the process of working on a restructuring plan, but several customers are asking for more definitive timelines for complete access to their funds. As things stand, whether WazirX will be able to recover from this devastating blow remains to be seen.
