Stolen Funds from WazirX Converted to Ethereum
Stolen funds from the Indian cryptocurrency exchange WazirX are being converted into ether to prevent authorities from blacklisting these assets. According to data from the analytics platform Spot On Chain, the attackers prioritized ETH over other ERC-20 tokens because it cannot be blacklisted.
Advantages of Ethereum
The ERC-20 token standard allows developers to implement mapping functions in smart contracts to maintain a list of blacklisted addresses. Therefore, they can modify the transfer function to check against this list before processing the transaction. In contrast, ETH does not allow modification of address permissions, maintaining its core decentralized and trustless nature. Blockchain security company PeckShield mentioned that a quick switch to Ethereum could help hackers protect their funds before authorities or centralized token issuers take any precautions. This was evident in the April 2020 theft of $25 million from the dForce decentralized finance (DeFi) protocol through Ethereum.
After the Attack
Following the attack on WazirX, Cyvers detected several suspicious transactions from the exchange’s multi-signature wallet to new addresses, confirming that $234.9 million worth of assets were stolen. On-chain searcher ZachXBT speculates the involvement of the North Korea-backed Lazarus Group, noting similarities with their previous attacks. The hack led to a drop in SHIB and WRX tokens after news broke, highlighting the impact of such security breaches in the cryptocurrency market.
Overall, the hackers converting stolen funds to Ethereum as a strategic move to avoid blacklisting showcases the evolving tactics of cybercriminals in the digital asset space. The decentralized nature and stability of Ethereum make it an attractive option for laundering money and evading authorities. It is crucial for exchanges and security companies to remain vigilant and adapt their strategies to combat such threats effectively.
