Canadian KyberSwap Hacker Accused of Exploiting DeFi Vulnerabilities
US authorities have accused a Canadian of stealing approximately $65 million and laundering the proceeds by taking advantage of the decentralized finance (DeFi) protocols KyberSwap and Indexed Finance. Andean Medjedovic was charged with computer hacking, attempted extortion, money laundering, and bank fraud in an indictment filed by the Justice Department on February 3 in a federal court in Brooklyn.
According to the prosecution, Medjedovic engaged in deceptive trades to steal around $16.5 million from Indexed Finance liquidity pools in October 2021. In November 2023, he allegedly carried out a similar attack to exploit KyberSwap for approximately $48.8 million. Medjedovic is presently at large, according to the Brooklyn US Attorney’s office.
Medjedovic borrowed hundreds of millions of dollars in digital tokens, which he used to engage in deceptive trading that he knew would cause the protocols’ smart contracts to falsely calculate key variables,
prosecutors
KyberSwap Hacker Tried to Blackmail Victims Before Laundering Stolen Crypto
The prosecutors said that he tried to blackmail the victims of the KyberSwap exploit by putting forward a false settlement offer after allegedly abusing the flaw. They said that Medjedovic later requested control of the protocol in exchange for surrendering 50% of the digital assets he had unlawfully gotten through this scheme after threatening to postpone negotiations over the return of cash in a series of on-chain communications.
According to the indictment, Medjedovic then allegedly plotted with a family member to try to launder cryptocurrency that had been taken from KyberSwap and Indexed Finance using a crypto mixer and other blockchain bridges in order to cash out on exchanges and into bank accounts that had been set up using false information.
Through his deceptive trades, Medjedovic was able to, and did, withdraw millions of dollars of investor funds from the protocols at artificial prices, rendering the victims’ investments essentially worthless,
the indictment
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