Hackers Steal Over $90 Million From Cryptocurrency Exchange

Hackers have stolen over $90 million from a Japanese cryptocurrency exchange called Liquid. The firm announced that hackers had gained access to wallets they host online, gleaning roughly $91 million in crypto assets. $16 million of these were frozen as other exchanges pounced on the theft. London based blockchain analysis provider Elliptic estimates the losses to be around $97 million.

Elliptic also said it was crucial to note that $45 million of these losses were Ethereum tokens, “which are being converted into Ether using decentralised exchanges,” enabling “the hacker to avoid having these assets frozen.”

They further explained how the hackers planned to launder the Ether:

“This Ether is now being laundered through Tornado Cash, a smart-contract based mixer used to obscure the blockchain money trail. Close to $20 million of the stolen assets have been sent to Tornado, as of the last update of this article. Exchanges and other crypto service providers should be on the alert for large deposits that originate from Tornado cash.”

This is the second time in ten months that liquid has been the victim of a hack. In November 2021 someone gained access to the firm’s document storage infrastructure, but no funds were stolen.

Liquid has halted all crypto withdrawals and asked their customers to refrain from crypto deposits until their system is secure. Fiat currency withdrawals and deposits can still be made.

Hackers target cryptocurrency exchange as market value rises

The hack comes only a week after the market value of crypto currency rose back up to $2 trillion as Bitcoin and other cryptocurrencies ascended in value. Bitcoin, XRP, Cardano, and Dogecoin all saw significant climbs this past week, with Bitcoin at one point hitting $48,512 — its highest value since May 16.

Bitcoin was not alone in its climb, however — Cardano, the third ranked currency behind Ether and Bitcoin, has gone up 47% in the past week. XRP has gone up 61% and Dogecoin 18% in the same timeframe.

“Bitcoin continues above its critical 200-day moving average,” strategists from Fundstrat, an independent research firm, noted last Friday. “Also on our radar is Cardano (ADA), which after signaling smart contracts are soon to hit the platform earlier this week is up.”

The rise in the market follows the cryptocurrency industry’s unsuccessful attempt to change the crypto tax reporting rules in a U.S. infrastructure bill which allowed for broad oversight of cryptocurrencies.

“The price of Bitcoin was surprisingly resilient in the wake of the news,” said NYDIG Global Head of Research Greg Cipolaro last Saturday. “We interpreted this price action as extremely bullish,” and “we think the recognition of the crypto industry by lawmakers was ultimately a legitimizing event, one that should give investors comfort that this industry is here to stay,” added Cipolaro.