Binance, the conduit for hackers, scams and drug trafficking in 2017

June 11, 2022 | 5:00 a.m.

Binancethe world’s largest cryptocurrency exchange, was hit by a group of North Korean hackers in September 2020, serving as a conduit for scams, hackers, and drug trafficking.

During that date, the computer group, known as Lazarusbroke into a small cryptocurrency exchange in Slovakia and stole a virtual currency worth 5.4 million dollars, with the aim of financing North Korea’s nuclear weapons program.

Binance had no idea who was moving money through its exchange, due to the anonymous nature of the accounts.

Eterbase co-founder Robert Auxt, whose firm has been unable to locate or recover the funds, told Reuters.

Following the fraud, the hackers opened at least two dozen anonymous accounts on Binance, allowing them to convert the stolen funds and hide the money trail, correspondence between the Slovak national police and Binance reveals.

In just nine minutes, using only encrypted email addresses as identification, the Lazarus hackers created Binance accounts and traded cryptocurrencies stolen from ether basethe Slovak exchange.

Also, the missing Eterbase money is part of a torrent of illicit funds that flowed through Binance from 2017 to 2021.

DuDuring that period, the cryptocurrency exchange processed transactions totaling at least $2.35 billion stemming from computer hacking, investment fraud and the sale of illegal drugs, according to research by Reuters.

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Binance received more funds for 770 million dollars

Separately, the crypto researcher chain analysishired by US government agencies to track illegal flows, concluded in a 2020 report that Binance received criminal funds totaling $770 million in 2019 alone, more than any other cryptocurrency exchange.

Meanwhile, the CEO of Binance, Changpeng Zhaoaccused Chainalysis on Twitter of “bad business etiquette”, in addition to refusing interviews to clarify the situation, for which the director of communications, Patrick Hillmanhad to take the floor, stating that Binance did not consider the Reuters calculation to be accurate.

Binance is building the most sophisticated cyber forensics team on the planet and is looking to further improve its ability to detect illegal crypto activity on our platform.

Patrick Hillmann said.

In addition to criminal funds from 2019, the agency reported last January that Binance maintained controls on money laundering weak on its users through mid-2021, despite concerns raised by high-level company figures starting at least three years earlier.

Hydra’s case

According to the research, from 2017 to 2022, buyers and sellers in the world’s largest darknet drug market, Hydraused Binance to make and receive crypto payments worth 780 million dollars.

In April, the US Department of Justice announced that US law enforcement and Germany they had taken over Hydra’s servers.

The United States accused the alleged administrator of the servers of conspiring to launder money and distribute illicit drugs. Given this, the site was closed and the alleged administrator was arrested by the Russian authorities.

Also read: Cryptoverse: investors warn why bitcoin is ‘bottoming out’

Other Binance Moves

With around 120 million users worldwide, Binance processes crypto transactions worth hundreds of billions of dollars per month, however, the sector was affected by a strong correction in May, as your overall value it plummeted by a quarter to $1.3 trillion.

Despite the hits, Binance is expanding its reach into traditional businesses, after announcing a investment of 200 million dollars in Forbes this year and committing another $500 million to the Tesla CEO’s bid, Elon Muskto be in charge of Twitter.

However, last week Forbes abandoned its plans to go public and a spokesperson reported that Binance’s investment would not go through; For his part, Musk did not respond to requests for comment.

In this way, the flow of illicit cryptocurrencies through Binance represents a small portion of the exchange’s overall trading volumes.

While lawmakers and regulators, including the US Treasury secretary, Janet Yellenand the president of the European Central Bank (ECB), Christine Lagardeexpress their concern about the illegal use of cryptocurrenciesthe trade demonstrates how criminals have turned to technology for money laundering.

Keep reading: Christine Lagarde declares that cryptocurrencies are ‘risky’ and have no value

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