Chainalysis: two groups are responsible for stealing $1 billion in cryptocurrency

29 Jan, 2019 | Updated: 29 Jan, 2019
by Richard Allen
Chainalysis: two groups are responsible for stealing $1 billion in cryptocurrency

According to a new report published by blockchain analysis firm Chainalysis, it's likely that just two groups have stolen around $1 billion worth cryptocurrencies, accounting for the majority of money lost through such scams, the Wall Street Journal reports.

Since Bitcoin’s inception, over $1.7 billion worth of cryptocurrencies are estimated to have been stolen

The chief economist at Chainalysis, Philip Gradwell has stated that it's likely the two groups are still active. The firm spent about three months tracking the funds in known hacks and admitted that its analysis may not be correct. The company is also unsure of the identities of the two groups.

According to the firm, one of the hacking groups, named Alpha, is “a giant, tightly controlled organization at least partly driven by nonmonetary goals,” Chainalysis states. The second group, Beta, is smaller but places more emphasis on financial gain.

The two groups reportedly employed an extensive network of digital wallets to cover their tracks before converting the stolen funds into physical cash through online exchanges and individual transactions. Chainalysis found that, on average, the stolen funds were transferred 5,000 times before being converted into cash.

According to the report, Alpha begins shuffling the funds immediately, the group convert around three-quarters of the stolen funds into fiat within an average of 30 days. Beta, however, tend to sit on the money for up to 18 months.

The report also indicates that the groups sometimes use regulated exchanges that employ anti-money laundering procedures knowing that, after all the shuffling, even regulated exchanges would have difficulty tracking the money.

Read more: Security expert: nearly $2.5 million stolen from exchanges daily; Crypto needs a serious security update

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