The United States Department of Justice (DoJ) is channeling energy towards cracking down on crypto hackers whose activities have intensified. According to the Financial Times, the DoJ’s National Cryptocurrency Enforcement Team (NCET) has taken cognizance of the fact that these hacks, exploits, and crimes have multiplied in the level of occurrences in the last few years.
Last year, over $20 billion in cryptocurrency was recorded to have been siphoned by bad actors with December seeing the least crypto theft. According to blockchain audit company CertiK, only a loss of $62.2 million was recorded in December from 23 major attacks including that of Defrost Finance. The total crypto theft recorded in 2022 was around 40% higher than that of 2021.
Director of the NCET, Eun Young Choi, revealed that companies that commit crypto crimes either directly or indirectly are also under the radar of the agency.
“We’re seeing the scale and the scope of digital assets being used in a variety of illicit ways grow significantly over the last, say, four years. I think that is concurrent with the increase of its adoption by the public writ large,” the director elaborated further.
Hackers Leverage Crypto Mixers
Choi confirmed that the agency is particularly concerned with crypto exchanges and crypto mixers also called tumblers. These tools are used most times by crypto investors to hide the original source of their digital assets holdings, especially when they want to remain anonymous.
However, it has been discovered that over time some bad actors have leveraged these same platforms to conceal the loot which they earned from defrauding investors of their hard-earned crypto holdings. Putting it in perspective, most of these platforms are known to encourage and enable money laundering activities.
Tornado Cash which was rumored to be making a comeback was one of the crypto mixers utilized by hackers to obfuscate digital assets up to the tune of $7 billion. The renowned crypto mixer was sanctioned by the U.S. Treasury Department Office of Foreign Assets Control (OFAC) in 2022 for its association with several money laundering operations.
In the long run, Choi is hopeful that the increased scrutiny will help change the minds of companies that are involved in such illicit activities.
