The story of money laundering on Tornado Cash continues. And this, despite the sanctions imposed on this crypto mixer. This time, $500,000 stolen from the crowdfunding platform DAO Maker was transferred via the platform.
DAO Maker hack: Back to the facts
Crowdfunding platform DAO Maker was hacked in August 2021. Hackers managed to steal $7 million worth of stablecoins by emptying some users’ accounts. Hackers took advantage of a vulnerability in one of the company’s crypto wallets. This allowed them to gain administrator privileges. Hackers first used the exploit to steal 10,000 stablecoins pegged to the USDC dollar. They then made 15 more trades.
The hackers dispatched the stolen funds to different addresses they control. A few days ago, they reportedly used an Etherscan address to transfer $500,000 into DAI stablecoin. This information comes from the blockchain security company Peckshield. In a Tweet, the company states: “ We saw $500,000 in DAI transferred from EOA 0x0B789 to @TornadoCash. This address is directly associated with developer DAOMaker who stole funds from @TheDaoMaker. »
Tornado Cash: Anonymize Stolen Funds
Cybercriminals often use the Tornado Cash crypto mixer to launder stolen and illicit funds. Users resort to crypto mixers to anonymize fund transfers between services. Hackers take advantage of this ability of tumblers to launder money. Tornado Cash is a cryptocurrency mixer service launched in 2019. The platform is based on Ethereum. It collects Ethereum cryptocurrencies from multiple platforms and then mixes them (tumbler) to hide the source.
Faced with the explosion of money laundering via Tornado Cash, the Office of Foreign Assets Control (OFAC) of the Treasury Department imposed sanctions on the platform on August 8. With this sanction, all Americans and local entities cannot interact with Tornado Cash or Ethereum (ETH) wallets linked to the protocol. Regardless, cybercriminals are not shy about defying the authorities by continuing their Tornado Cash operations. This is despite the risk of a fine of up to $330,000 and a prison sentence of up to 30 years.
This case of money laundering on Tornado Cash will certainly not be the last. You must know that Tornado Cash is not a traditional business associated with legal persons. It is a decentralized project based on open source smart contracts. Because the codes are open source and freely available to the public, they can be redeployed under a different name, allowing infinite replication. A boon for cybercriminals, but a major challenge for the authorities.
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