Approximately $20 million in crypto likely stolen from US government, sleuths Arkham and ZachXBT say

Quick Take

  • Someone appears to have stolen approximately $20 million in stablecoins and ETH from wallets belonging to the U.S. government, according to onchain movements tracked by Arkham Intelligence.

Someone appears to have stolen approximately $20 million worth of cryptocurrency from wallets belonging to the U.S. government, according to analytics firm Arkham Intelligence. Unusual onchain activity began at approximately 2:00 p.m. ET on Thursday, when funds that have not moved in over eight months were pulled out of decentralized lending platform Aave. 

“0xc9E received USG seized funds linked to the Bitfinex hackers from 9 separate USG seizure addresses, including 0xE2F699AB099e97Db1CF0b13993c31C7ee42FB2ac, an address named in the court documents relating to the Bitfinex seizure,” the company wrote on X. 

These tokens include nearly $14 million in the AUSDC stablecoin, $5.4 million worth of USDC, $1.1 million worth of USDT and nearly half a million worth of ETH. 

While the suspect has not yet been identified and it’s unclear how the U.S. government—which holds over $14 billion worth of dozens of different cryptocurrencies—was compromised, the suspicious account’s behavior would suggest this is a malicious operation. 

Shortly after moving the tokens, the account—which can be tracked here—began moving funds to various non-custodial applications in an apparent attempt to wash the funds, Arkham said. “We believe the attacker has already begun laundering the proceeds through suspicious addresses linked to a money laundering service.”

It was a point echoed by crypto sleuth ZachXBT, who said it’s more likely the funds were stolen rather than simply moved by the U.S. government, when asked by The Block. “U.S. government is not going to use Switchain or N.Exchange,” he said. 

The suspect’s wallet currently holds approximately $13 million worth of crypto, after he began sending funds to other addresses beginning 0x15D0a and 0xBf6F7, which hold about $5.5 million and $1.4 million worth of ETH, respectively.  

Crypto hacks are not an uncommon occurrence. Rekt estimates that nearly $81 billion worth of tokens have been lost in various exploits since 2011, but even in the world of crypto, the Bitfinex hack stands out. Only about $65 million was stolen at the time, making it approximately the 80th largest loss to date. 

However, when the government seized the funds from the odd couple Heather “Razzlekham” Morgan and Ilya Lichtenstein, the value of the stolen crypto had risen above $4 billion, making it the largest seizure to date. What should happen to those tokens is also hotly contested, though the government has suggested they will be returned to Bitfinex. 

If it turns out that the U.S. Marshals Service’s positions were compromised, it would be the latest surprising chapter in a story that has been unfolding since 2016.

Hours after the attack, crypto user typicaldoomer.eth sent the suspected hacker 69 NOCHILL tokens.


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About Author

Daniel Kuhn is a Senior Journalist and Editor at The Block, where he covers the crypto industry with a particular focus on tech. He previously served as deputy managing editor of opinion/features at CoinDesk. He first appeared in print in Financial Planning, a trade publication magazine. Before journalism, he studied philosophy as an undergrad, English literature in graduate school and business and economic reporting at an NYU professional program. You can connect with him on Twitter and Telegram @danielgkuhn or find him on Urbit as ~dorrys-lonreb.

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