As a researcher with experience in blockchain security and cryptocurrency investigations, I find the recent movement of over $950,000 in Ether from wallets linked to the CoinStats exploit to Tornado Cash deeply concerning. This development comes at a time when the investigation into the June security breach at CoinStats is still ongoing.
Approximately $1 million in Ether, originating from wallets associated with the CoinStats exploit, were transferred to the cryptocurrency tumbler, Tornado Cash, in recent transactions.
A significant new development has emerged within the past few days following the announcement of ongoing probes by the top cryptocurrency monitoring agency.
Tornado Cash Inflow
Certifying authority CertiK identified two wallets implicated in the CoinStats hack in June, which collectively sent around 311 ETH, equivalent to roughly $959,000, to Tornado Cash. The first wallet transferred 211 ETH, and the second wallet moved 100 ETH towards the crypto tumbler.
On June 22nd, CoinStats announced a security incident that deceived some iOS users into receiving a false reward notification. In response, the company immediately halted operations to prevent further damage. Approximately 1.3% of their wallets were affected – equating to around 1,590 wallets in total. Users were reassured that their connected wallets and centralized exchanges (CEXes) remained unaffected throughout this incident.
The company announced on July 5th that the ongoing investigation regarding the incident is still active, yet they have withheld providing any additional information about involvement from law enforcement agencies.
“The security event that occurred on June 22 is under ongoing investigation, and we’re swiftly implementing robust measures to safeguard our recently established infrastructure. We’re putting in great effort to provide further details as soon as they become available, along with resources for those affected.”
Tornado Cash Devs’ Legal Firestorms
As an analyst, I’ve observed that despite encountering legal obstacles and intense scrutiny, Tornado Cash remains a popular choice for laundering ill-gotten funds. In the summer of 2022, the US Department of the Treasury took action against this service by adding it to their sanctions list, effectively barring its usage for American citizens, residents, and businesses. Consequently, the project’s website and GitHub repositories were deactivated.
In late March, Alexey Pertsev, a developer for Tornado.cash, was taken into custody in Amsterdam on charges of aiding in the masking of illicit financial transactions and enabling money laundering via the Ethereum tumbler service. A court handed down a sentence of five years and four months’ imprisonment to Pertsev last May.
As a researcher investigating the Tornado case, I uncovered new developments several months after the initial allegations. Two additional suspects, Roman Storm and Roman Semenov, were implicated in aiding a $1 billion money laundering operation. I later learned that Storm was apprehended in Washington State.
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2024-07-10 23:34