crypto Exchange eXch to Close Following Bybit Hack Allegations
summary
- cryptocurrency exchange eXch will cease operations on May 1.
- the closure follows allegations that the exchange laundered funds from the Bybit hack.
- eXch denies the allegations but cites a antagonistic regulatory environment.
- the Bybit hack resulted in $1.5 billion stolen in Ethereum [[2]].
- north Korean hackers are suspected of involvement in the Bybit exploit [[3]].
eXch Announces Closure
cryptocurrency exchange eXch announced it would cease operations on May 1,following reports alleging the firm was used to launder funds from a major Bybit hack. in an April 17 notice, eXch stated that the majority of its management team voted to cease and retreat
in response to the allegations. the exchange is accused of laundering roughly $35 million of the funds stolen in a $1.5 billion exploit on Bybit [[2]].
laundering cryptocurrency often involves using decentralized exchanges (dexs) and cross-chain bridges to obscure the trail of funds [[1]].
eXch claimed it was the subject of an active transatlantic operation
aimed at shutting it down and potentially pursuing charges. the exchange further elaborated on its decision:
even though we have been able to operate despite some failed attempts to shut down our infrastructure (attempts that have also been confirmed to be part of this operation), we don’t see any point in operating in a hostile environment where we are the target of sigint [signals intelligence] simply as some people misinterpret our goals.
eXch
allegations and denials
initially, eXch denied reports suggesting it had laundered digital assets for the lazarus group, a north Korean hacking group. however, the exchange later admitted to processing an insignificant portion of funds
from the february hack. members of eXch’s management team emphasized the exchange’s focus on user privacy, asserting that some exchanges abus[e] customers with nonsensical policies
in their attempts to combat money laundering.
the bybit hack: a crypto heist of epic proportions
the Bybit hack is considered one of the largest in cryptocurrency history. the incident led to over $5 billion in withdrawals from users, including the stolen funds. Bybit ceo Ben Zhou stated on feb. 22 that the exchange had the resources to cover the loss
if the funds were not recovered.
always enable two-factor authentication (2fa) on your cryptocurrency exchange accounts to enhance security and protect against unauthorized access.
subsequently, Bybit announced it would shutter some of its web3 services and close its non-fungible token (nft) marketplace. despite the significant losses, Bybit had regained its market share to roughly 7% by April 10, the level it held before the hack.the exchange also paid over $2 million to bounty hunters for facts that could help freeze funds traceable to other platforms. as of March 20, approximately 89% of the $1.5 billion stolen was estimated to be traceable [[3]].
north korean involvement
north Korean hackers, notably the lazarus group, have been implicated in the Bybit hack [[3]]. these actors are known for their complex techniques in laundering stolen cryptocurrency, frequently enough using multiple intermediary wallets, converting funds into different cryptocurrencies, and employing decentralized exchanges (dexs) and cross-chain bridges to obfuscate the trail [[1]].
faq
- why is eXch closing?
- eXch is closing due to allegations of laundering funds from the Bybit hack and a perceived hostile regulatory environment.
- how much was stolen in the Bybit hack?
- approximately $1.5 billion in Ethereum was stolen [[2]].
- who is suspected of being behind the Bybit hack?
- north Korean hackers, specifically the lazarus group, are suspected [[3]].
- has Bybit recovered from the hack?
- yes, Bybit has regained its market share and is working to recover the stolen funds.
