Crypto News – Cryptocurrency Exchange Poloniex Hack: Over $50 Million Laundered Through Tornado Cash Protocol

Crypto News – Cryptocurrency Exchange Poloniex Hack: Over $50 Million Laundered Through Tornado Cash Protocol

Crypto News – In a significant development related to the infamous Poloniex hack of November 2023, it has been revealed that over half of the stolen $100 million worth of Ether has been channeled through the privacy-centric protocol Tornado Cash.

The hack, which occurred on November 10, 2023, saw a substantial unauthorized outflow of funds from wallets associated with the cryptocurrency exchange Poloniex. Subsequent investigations concluded that the breach resulted in the loss of over $100 million worth of Ether, with indications pointing towards a compromise of private keys as the likely cause, as confirmed by blockchain security firm CertiK.

Following the breach, Poloniex took immediate action by temporarily disabling the compromised wallets. Despite the exchange’s efforts to identify the hacker and offer a substantial bounty of $10 million, the stolen funds remained unrecovered.

Six months later, it became evident that the perpetrator had utilized Tornado Cash to anonymize a significant portion of the stolen funds. Specifically, over 17,800 ETH from six different wallets were traced to a single Tornado Cash address, valued at approximately $53.3 million at the time of transfer.

Despite the setback, Poloniex resumed its operations promptly, allowing users to deposit and withdraw cryptocurrencies without interruption. Additionally, the exchange took proactive measures to bolster its security framework, engaging a top-tier security auditing firm to fortify its defenses against future breaches.

Poloniex’s owner, Justin Sun, who acquired the exchange in 2019, assured affected users of full reimbursement, citing the exchange’s robust financial position. Sun also expressed openness to collaboration with other exchanges to expedite the recovery of the lost funds.

The incident underscores the ongoing challenges faced by cryptocurrency exchanges in safeguarding user assets and highlights the importance of robust security measures in the rapidly evolving landscape of digital finance.