Saturday, 3 February 2024

Hackers Behind $400 Million FTX Breach Have Been Exposed

by Rose White

Hackers Behind 0 Million FTX Breach Have Been Exposed

A recent report has provided insights into the hackers who may have been responsible for the infamous hack on the defunct FTX. This breach, which occurred after FTX filed for bankruptcy had led to the hackers draining over $400 million worth of crypto from the crypto exchange. 

DOJ Charges Three People Like Responsible For FTX Hack

According to Bloomberg, the Department of Justice (DOJ) has charged Robert Powell, Emily Hernandez, and Carter Rohn for their involvement in a SIM-swapping ring that targeted a crypto exchange and other individuals. 

The report noted that the court documents didn’t mention FTX as the crypto exchange that was hacked, but there was confirmation from sources familiar with the case that it was indeed FTX. Specifically, these hackers are reported to have gained access to FTX’s wallets by sim-swapping the details of an FTX employee

Bitcoinist had reported how these hackers stole over $400 million from the collapsed crypto exchange just hours after it filed for bankruptcy. After draining the crypto wallets, they then proceeded to funnel these funds through several decentralized exchanges (DEXs) and converted some of the tokens in a bid to cover their tracks. 

Meanwhile, SIM-swap attacks have become common in the crypto space. Ethereum’s co-founder Vitalik Buterin previously revealed that this was how he lost his X (formerly Twitter) account to hackers. 

The same thing happened with MyDogeWallet’s X account, which was hacked last year. The Dogecoin wallet’s CTO (Chief Technology Officer) Alex revealed then that his phone was SIM swapped. Bitcoinist also reported how SIM swap attacks had led to a loss of over $13.3 million worth of crypto in just four months. 

Crypto Exchange Sued By Disgruntled Creditors

FTX creditor Sunil Kavuri revealed in an X post that he, alongside other FTX customers, had filed an adversary lawsuit for fair recovery and damages. This comes after FTX revealed its repayment plan, which showed that it intends to repay customers based on the crypto prices as of November 2022 (the time when it filed for bankruptcy).  

US Bankruptcy Judge John Dorsey had explained that he couldn’t overrule the exchange’s proposed plan as US bankruptcy law mandates that debts be repaid based on their value at the time of the company’s bankruptcy filing. Seeing as they are unlikely to get repaid based on current crypto prices, these customers are hoping that they can get paid damages as a form of restitution. 

The plan is to get FTX to return these customers to the state they were in before the crypto exchange’s negligence caused them a financial loss.