Hacks News

THORSwap Temporarily Suspends Services, as a FTX Attacker Moves Stolen Funds via Threshold

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Key Points

  • The FTX attacker has switched to utilize the Threshold Network Chain instead of using THORChain to convert stolen Ethereum into Bitcoin.
  • Since the wallet was revived last week, the attacker has switched about 75,000 ETH, totaling over $124 million.
  • THORSwap announced that it was entering “maintenance mode” because it did not want to participate in the “movement of illicit funds.”

CryptoCaster Quick Check:

Attackers on FTX were compelled to abandon their plan to exchange their illegal Ethereum holdings for Bitcoin. This action was taken in response to THORSwap’s decision to enter maintenance mode, which was based on the THORChain.

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The FTX exploiter was no longer transferring the stolen assets via THORChain, according to a report from on-chain expert Lookonchain on October 6.

The FTX Attacker Changes Its Network

The attacker was instead exchanging the stolen money through the Threshold network. According to a screenshot from the analyst, the exploiter exchanged almost 3,000 ETH for tBTC via the Threshold Network Chain.

FTX Attacker Transactions. (Source: Lookonchain)

The protocol acts as a decentralized link between Bitcoin and Ethereum, claims the official tBTC website. It makes it easier to convert user assets into an ERC-20 token that is pegged 1:1 to bitcoin.

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By using a cohort of randomly chosen node operators within the Threshold Network, this bridge does away with the necessity for centralized intermediates.

This strategy maintains a strong defense mechanism while enhancing the security of users’ valuables.

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For the first time in nearly a year, the FTX attacker transferred about $10 million in Ethereum last week, according to reports. The exploiter converted a total of 75,636 ETH worth $124 million into Bitcoin since then.
However, as of the time of publication, the attacker’s wallet still had 109,485 ETH, or around $180 million.

Notably, the transfer of the funds parallels the New York trial of Sam Bankman-Fried, the former founder of FTX.
The timing of the intrusion has led to rumors that an insider at FTX may have been responsible.

THORSwap Enters Maintenance Mode

The FTX attacker’s prior privacy tool of choice, THORSwap, disclosed that it was entering “maintenance mode” because it did not wish to aid in the “movement of illicit funds.”

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THORSwap said the decision was made after consulting with advisors, legal counsel, and law enforcement organizations in a post on X on October 6. It read:

“The decision was made to temporarily transition the THORSwap interface into maintenance mode. This action was taken to swiftly curtail any further potential illicit activity. THORSwap will remain in this mode until a more permanent and robust solution can be implemented to ensure the platform’s continued security and integrity.”

The DEX added that this action will limit the platform’s entire coin-swapping functionality. However, the protocol still allows its users to borrow and stake assets.

In the meantime, THORChain stated that its activities are unaffected by THORSwap’s decision because its network is still fully functional and able to accommodate a range of interfaces.CRYPTOCASTER® - DECENTRALIZED FREEDOM!


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