KuCoin Maintains Wallet Freeze as Hackers Begin Laundering Stolen Crypto

The exchange's weekend thieves appear to be searching for buyers of their $281 million in stolen crypto.

Sep 29, 2020 at 3:52 p.m. UTC
Updated Sep 14, 2021 at 10:02 a.m. UTC

KuCoin left its customers' accounts on lockdown Tuesday as the exchange's weekend hackers continued to slosh around millions of dollars in stolen cryptocurrency.

  • Transaction tracing twitter account Whale Alert flagged 18.4 million XRP tokens ($4.5 million) flowing into a "hack wallet" on Tuesday morning eastern time.
  • Hackers routed 17 million of that haul into a sub-wallet less than an hour later. Shortly after that, four batches of roughly four million tokens apiece flowed into yet more sub-wallets, where they appeared to sit at press time.
  • The XRP is only a drop of the $281 million in cryptocurrencies (especially bitcoin, Tron tokens, Stellar tokens and Ethereum tokens) that tracing firm Elliptic estimated was stolen from KuCoin over the weekend.
  • Ethereum-based tokens in particular dominate the haul. Hackers made off with $150 million total in tether, chainlink and other Ethereum-based tokens, Elliptic said.
  • The hackers have largely failed to sell those tokens on closely guarded centralized exchanges which quickly flag and often block hacked funds.
  • Still, by Monday, Elliptic said that hackers had already flipped millions of stolen tokens for $7.5 million in ethereum (ETH) on decentralized exchanges (DEX) Kyber Network and Uniswap.
  • Elliptic, which is now eyeing that ETH, said in its Monday blog post that the laundering will likely continue on DEXs.
  • KuCoin maintained its post-hack deposit and withdrawal freeze well into Tuesday. It began cancelling previously scheduled programming (including a trading competition) as a result.
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