In a recent tweet, KuCoin CEO Johhny Lyu said that he has “substantial proof” for the hackers who were responsible for a massive $281 million hack of the exchange. The hack occurred on September 26.
A tweet creates a storm
“After a thorough investigation, we have found the suspects of the 9.26 #KuCoin Security Incident with substantial proof at hand. Law enforcement officials and police are officially involved to take action.”
The hack occurred on September 26 when hackers leaked private key access to the wallets owned by the exchange. KuCoin noted that it has enough cash in its bank to cover the losses. After the hack took place, some crypto projects actively worked to freeze the stolen assets or render them useless. Some of the blockchains were updated specifically for this purpose,
Where did the hacked money go?
According to Lyu, at least 72% of the money is not in the control of the suspicious addresses. The hackers sold $13 million worth of cryptocurrencies on decentralized exchanges. On October 1, he announced the recovery of $64 million from the suspicious addresses. The total value of recovered assets in the hack is $204 million.
On September 30, he acknowledged the hack and said that the 3-year old exchange never adopted lax security measures but was still not able to dodge the hack. After the hack, KuCoin paused deposits and withdrawals for the customers. The exchange has slowly started opening up and currently supports deposits and withdrawals for 31 crypto assets, including Bitcoin, Ethereum, and Tether.
KuCoin became the first major case where decentralized exchanges were used to launder funds. According to blockchain research firm Chainalysis, the funds went through mixing services and decentralized exchanges to hide their tracks. It suggests that the hackers stole 1,008 BTC in the attack which was split into two wallets. One of the wallets held 875 BTC which came via centralized exchanges, bought with altcoins stolen in the hack. Of these coins, roughly 683 BTC were sent to mixing services.