CEO of SingleSource on Cryptopia hack: "for use in the criminal underworld"

20 Feb, 2019 | Updated: 20 Feb, 2019
by Ryan Boltman
CEO of SingleSource on Cryptopia hack: for use in the criminal underworld

The Cryptopia hack is now over one month old, the exchange is still closed for business and police are currently wrapping up much of their investigation. CEO Kelvin Chandran of Blockchain-based identity and risk scoring platform, SingeSource weighs in on the current situation of the hacked funds. 

Chandran and his team have been tracking the stolen funds from Cryptopia, reports Stuff NZ, sighting several hurdles such as decentralized exchanges (DEX) and sending the coins to centralized exchanges, preventing further tracking of individual amounts of coins. 

 Read More: The Cryptopia Hack Timeline: as it happened

"We track the funds because we want to make our clients aware of which wallets are tainted, to comply with anti-money laundering regulations," says Kelvin Chandran, CEO of SingleSource, a blockchain-based identity and risk scoring platform. Chandran can't tell me why the breach occurred, but he can shed light on what's happened since then.

Chandran explains that "The hackers compromised the key and got control of the whole entire database,"  The database contained the private keys of over 80,000 wallets linked to Cryptopia. They then slowly drained the exchange for an estimated $20 million. SingleSource have been tracking five wallets linked to the hack, explaining that the hackers moved the funds from over 88,000 user wallets into the five key wallets. 

The wallets have been tracked as best they can, with Chandran stating "When you hit the exchange, that's where the traceability ends. Just like how real cash could be laundered through a casino," His team utilize their wallet-screening service to track the funds and notify exchanges as fast as possible when hackers funds are being moved. 

Read More: Cryptopia hackers have liquidated $3.2 million in tokens so far

Chandran explains that the community plays a huge roll in tipping off exchanges when hackers funds are being moved. One of the problems the hackers might appear to encounter, is how to sell the tokens and cash out into fiat currencies without being tracked. Due to this, Chandran believes the hackers will most likely hold onto the bulk of the coins and potentially use them on the dark web for other criminal activities. "They might cash out a small amount, but more likely they'll keep it there, for use in the criminal underworld."

 The latest from Cryptopia: 

Read More: NZ Police: "Cryptopia can open again whenever they like"

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