Accused of Laundering Crypto for Bybit Hackers, Platform Bows Out

The privacy-focused cryptocurrency exchange has confirmed that its role in laundry funds related to the Buybit Hack in February will expand and expand its role and then officially close all businesses on May 1st.

The move comes after an internal consensus among leadership to “stop and retreat” rather than continue under what is described as a hostile operating environment.

The shutdown is reportedly targeting the platform with the intent to dismantle infrastructure and pursue criminal charges following the emergence of exchange claims. This included accusations that it had allowed around $35 million in terrorist financing and washing up with a code that allegedly dated back to North Korea’s Lazarus group.

Let’s exchange

The exchange team admitted that some of the illegal funds may have passed through the platform, but vehemently denied intentional promotion of criminal activity.

The exchange also refused to characterize the service as a “mixer” despite comparisons by on-chain analysts. The platform’s founders criticize the broader crypto compliance landscape, aiming for what is called “nonsense lean policies” of exchanges that rely on third-party AML scoring APIs, argue that they are easily bypassed and can hardly provide real protection.

As the exchanges are ready to decline, they announced the creation of a 50 BTC open source fund to support financial tools and wallets that provide privacy across a variety of ecosystems such as Bitcoin, Ethereum and Torcaine. Partners will retain limited access to the API until controls are transferred to the new management group are confirmed.

“A goal that we certainly didn’t have in mind was to allow for illegal activities such as money laundering and terrorism as we are now accused, and there is no motivation to run any projects that are considered criminals.

This makes no sense to us. Originally, we were a team of privacy enthusiasts with major areas of interest quite apart from cryptocurrencies, and we saw absolutely unfair events. The project was an attempt to regain the balance in the industry. ”

Bybit Hack

Bybit Hack in February, which released over $1.5 billion in digital assets, including Steth and Meth, ranks among the biggest theft in crypto history. Onchain investigator Zachxbt and Security Alliance’s Nick Bax previously claimed that the exchange had facilitated the washing of funds stolen in a Bibit hack by North Korean Lazarus Group.

Additional claims from blockchain analysts and security company Slowmist support accusations citing ether transfers from hack-linked wallets.

Despite the severe blow, Bybit was able to regain momentum in the market. As of April 9, analytics firm Block Scholes reported that the market share of exchanges had risen from its 4% lowest to about 7% following the violation. This rebound reflects a strong comeback in spot trading volume and overall exchange activity, suggesting that the platform is recovering faster than initially expected.