Four hackers responsible for exploiting crypto exchange WazirX, DeFi protocols Penpie and LiFi, and crypto entrepreneur Bo Shen have transferred $49.3 million in stolen ETH through the Tornado Cash mixer this September. Data from SpotOnChain shows that between September 1 and 8, these hackers funneled 20,561 ETH, worth $49.3 million, through the banned crypto mixer.
Their money laundering activities coincided with a 13% drop in ETH value, causing the asset to drop below $2,200 and raising concerns about its long-term potential. However, ETH is facing many pressures apart from the selloffs by hackers.
Penpie exploiter launders all stolen ETH as WazirX hacker still holds $123 million
On-chain data shows that the Penpie hacker moved 11,261.2 ETH, worth $26.72 million, through Tornado Cash over the past week, signaling that they have now laundered all the funds stolen from the Pendle-based protocol on September 2. With the hacker choosing to transfer the funds through the mixer, it is now evident that they are not white hackers and will not take up Penpie’s offer of a 10% bounty for anyone who could help recover the assets.
Interestingly, an address connected to the $197 million Euler Finance hack of March 2023, which returned stolen funds, sent an on-chain message praising the Penpie hacker for keeping the stolen assets.
He said:
“Good job, bro. I didn’t see a hack like this for a while. I’m happy you kept all the money and didn’t let these bastards get back one dollar of what you took. You won; they lost. Good job.”
While the Penpie exploiter chose to launder everything at once, the WazirX hacker who stole over $230 million in ERC-20 tokens from the exchange is adopting a slow and steady approach, likely because of the magnitude of the stolen assets.
Laundered ETH Through Tornado Cash (Source: SpotOnChain)
Since September 2, they have transferred 7,600.1 ETH, worth $18.51 million, through Tornado Cash, leaving them with a substantial 54,155 ETH, valued at $123.32 million.
Meanwhile, other bad actors have also been busy with Tornado this month. The LiFi hacker who stole $9.7 million from the DeFi protocol in July also sent 200 ETH, worth $484,400, through the mixer, while the hacker who stole $42 million from Fenbushi Capital founder Bo Shen in November 2022 transferred 1,500 ETH, worth $3.57 million.
Ethereum declines 13% as hackers turn to Tornado Cash again
The recent spate of transfers through Tornado Cash highlights how hackers in the past few months, partly because regulators have cracked down on alternatives. Most hackers had initially stopped using Tornado Cash after the US Treasury sanctioned it in August 2022, even though the decentralized platform was still operational.
With hackers returning to the platform, it has seen increased volume in 2024, with Flipside Crypto reporting that Tornado Cash received $1.8 billion in the first half of the year alone. Experts believe this highlights the ineffectiveness of sanctions against the decentralized mixer.
However, hackers’ activity on Tornado Cash and their ETH selloffs might be taking a toll on Ether prices. The asset struggled throughout September, reaching a 13% decline at some point. Although it looks to be on the path to a rebound, it is too early to determine its direction.
Ethereum Price Performance (Source: VanEck)
Analysts at the investment firm VanEck attribute ETH price struggles to various factors, including the decline in blockchain activity, market uncertainty, and regulatory pressure from the Securities and Exchange Commission’s Wells notice against OpenSea. They note that Ethereum ranks 13 among 22 major Layer 1 projects in yearly returns with 62%, far below Bitcoin with 138%, and Solana with 624%. ETH is also the 18th worst-performing asset in the past 30 days.
