Tornado Cash: Risks and Consequences for DeFi Security

  • How Lendhub Network Malicious Actors Laundered $3.85M
  • Filipinos Alerted About Cryptocurrency scams

How Lendhub Network Malicious Actors Laundered $3.85M

The persons thought to be behind the world’s biggest scam in early January 2023, valued at several million dollars, reportedly made deposits into Tornado Cash even though the cryptocurrency combining platform is subject to penalties.

These individuals, thought to have planned the $6 million hack on the DeFi financing platform Lendhub, have transferred over 50% of all profits to the authorized cryptocurrency mixer.

Beosin and PeckShield, two blockchain security agencies, warned their followers of a cash transfer on February 27. They said a wallet linked to the January 12 scam transferred into Tornado Cash about 2,415.4 Ethereum, valued at $3.85 million.

A Singapore-based blockchain security company called Beosin revealed on Twitter that the newest transfer of 2,415 Ether to Tornado Cash shows that the scammers had sent 3,515.4 ETH in total to the cryptocurrency mixer since January 13. This sum is worth more than $5.7 million in today’s market.

By blending their coins with those of different users, thus severing the connection between the sender and recipient’s address, cryptocurrency tumbler Tornado Cash provides services to users to prevent the identification of the actual source.

Mixing is accomplished by combining a sizable amount of coins from several users and then dispersing them randomly to various addresses. On August 8, 2022, the US Office of Foreign Assets Control (OFAC) blocklisted Tornado Cash for allegedly laundering illegal money, including its use of tumbling services.

Tornado Cash is still in use since it is a decentralized blockchain-based smart contract, despite being sanctioned and having had its website removed.

Hacking and frauds previously accounted for roughly 34% of all assets entering into Tornado Cash, with inflows occasionally reaching up to $25 million daily, according to a report by blockchain analytics company Chainalysis in January. Yet, in the month that followed the imposition of the penalties, these inflows fell by 68%.

Filipinos Alerted About Cryptocurrency Scams

While scammers may connect Telegram, TikTok, and Facebook to cryptocurrency scam syndicates, the Bureau of Immigration (BI) on February 27 advised Filipinos to exercise caution when taking open positions from these platforms.

The BI said that eight Filipinos were misled into accepting job offers from an online scam utilizing this technique. Three of the eight victims of the online scam left through Clark International Airport, and the other two left through Ninoy Aquino International Airport (NAIA).

The two people that exited through NAIA identified themselves as vacationers. One claimed to be an officer at a local business, whereas the other went to Cambodia from Bangkok alongside his partner.

As a result of their visas having expired or being about to expire, foreign workers from the Philippines who were working in UAE and Dubai have reportedly fallen victim to bitcoin scams in Thailand. As a result, the Philippine Department of Foreign Affairs (DFA) has sent instructions to its embassies worldwide to prevent Filipinos from becoming victims of these scams, said Norman Tansingco.

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