New analysis from blockchain analytics and crypto compliance agency Elliptic has revealed the extent to which cross-chain bridges and decentralized exchanges (DEXs) have eliminated boundaries for cybercriminals.
In an Oct. 4 report titled “The state of cross-chain crime,” Elliptic researchers Eray Arda Akartuna and Thibaud Madelin took a deep dive into what they described as “the brand new frontier of crypto laundering.” The report summarized that the free movement of capital between crypto property is now extra unhindered as a result of emergence of recent applied sciences akin to bridges and DEXs.
Cybercriminals have been utilizing cross-chain bridges, DEXs, and coin swaps to obfuscate at the least $4 billion value of illicit crypto proceeds for the reason that starting of 2020, it reported.
Round a 3rd of all stolen crypto, or roughly $1.2 billion, from the incidents surveyed, was swapped utilizing decentralized exchanges.
Delving additional into the main points, the report famous that greater than half of the illicit funds it recognized had been swapped immediately by two DEXs — Curve and Uniswap, with the 1inch aggregator protocol coming an in depth third.
An analogous quantity (round $1.2 billion) has been laundered utilizing coin swap companies which permit customers to swap property inside and throughout totally different networks with out having an account.
“Many are marketed on Russian cybercrime boards and cater virtually completely to a felony viewers,” it famous.
Sanctioned entities are more and more turning to such applied sciences with a view to transfer funds and perform cyber-attacks, in line with Elliptic.
“Wallets related to teams finally sanctioned by america – together with these utilized by North Korea to perpetrate multi-million-dollar cyberattacks – have laundered greater than $1.8 billion by such strategies.”
In a June report on digital asset dangers, world cash laundering, and terrorist financing watchdog, the Monetary Motion Activity Drive (FATF), additionally fingered cross-chain bridges and “chain hopping” as a excessive danger.
Associated: $2B in crypto stolen from cross-chain bridges this 12 months: Chainalysis
The Ren bridge was talked about as a best choice for crypto laundering with the overwhelming majority of illicit property, or greater than $540 million, passing by it.
“Ren has turn into notably well-liked with these in search of to launder the proceeds of theft,” it stated.
One potential resolution to mitigate crypto theft was proposed by Stanford researchers final month. It entails an opt-in token customary referred to as ERC-20R that gives the choice to reverse a transaction inside a set time interval.
