Investigators Recover Over $30M From the Axie Infinity Hack
According to the blockchain evaluation firm Chainalysis, law enforcement authorities and crypto institutions have made a number of separate seizures over the past few months, which have resulted in the recovery of more than $30 million in cryptocurrency that was robbed by cybercriminals with connections to North Korea. (1) These seizures took place over a period of several months.
“The seizures represent about 10% of the total funds stolen from Axie Infinity (accounting for price differences between the time the funds were stolen and the time they were seized) and demonstrate that it is getting harder for bad actors to cash out their ill-gotten crypto gains successfully,” said Erin Plante, senior director of investigations at Chainalysis.
The company asserts that Chainalysis had succeeded in finding the assets, but the United States Treasury asserts that the monies were taken by the Lazarus cyber group from North Korea, after which they were cleaned up and sent to controlled exchanges.
North Korean Lazarus Responsible for the Hack
The Lazarus Group was responsible for the theft of $620 million worth of virtual currency in March from a blockchain program entitled Ronin Network, which was linked to the internet game Axie Infinity. (2) The money that was retrieved was taken by the Lazarus Group.
More than five months have passed since a hack into a cryptocurrency steered to the embezzlement of $620 million out from decentralized finance (DeFi) platform Ronin Network. The perpetrators of the theft used the Ethereum-based virtual currency tumbler Tornado Cash to siphon the vast majority of the revenue, which totaled $455 million. The news comes as a surprise to many people.
“This represents the first ever occasion that bitcoin stolen by a North Korean cyber gang has been seized,” said Erin Plante, Senior Director of Investigations at Chainalysis. “We’re confident that it won’t be the last,” she said.
Erin Plante is of the opinion that investigators who have access to the right resources should be able to follow the money in order to understand and thwart the efforts of a cybercrime organization to launder money.
Because laundering money often involves networks of front organizations and financial institutions working in potentially hostile states, this is tough to accomplish through the traditional financial routes because embezzlement usually takes place in multiple countries.
According to Chainalysis, increased transparency surrounding bitcoin transactions, together with increased collaboration between the public and private sectors, can help law enforcement agencies more effectively battle illegal money laundering operations associated with cryptocurrency.