Various cryptocurrency platforms continue to be in the focus of regulators. According to the latest developments, the US Department of Justice (DoJ) has shut down the Bitcoin “mixer”, that is, the “mixing” service ChipMixer. Here are the details…
Cryptocurrency project shut down after alleged illegal transaction of $3 billion
The US Department of Justice (DOJ) announced on March 15 that it was shutting down Bitcoin mixing service ChipMixer. DOJ says ChipMixer has been used to launder more than $3 billion in illegal cryptocurrency transactions since August 2017. That total includes $17 million in ransomware transactions, $200 million in dark web market transactions, $35 million in transfers linked to fraudulent data sales, and an unspecified amount of transactions linked to a malicious, Russia-based software campaign.
The DOJ also stated that the platform was used to process $700 million in connection with two blockchain “heists” against Ronin Bridge and Horizon Bridge. Law enforcement in the US seized two web domains that redirect visitors to ChipMixer and a GitHub account that hosts the project code. Police in Germany also seized the project’s “back end” servers and $46 million worth of cryptocurrency.
One person charged in case: could face 40 years in prison
One person – Vietnamese resident Minh Quốc Nguyenễn – was charged in the case. Nguyenễn launched ChipMixer in 2017 and paid for necessary services to run the platform using fake IDs. It also promoted the service online and advocated it as a solution to anti-money laundering (AML) and customer-knowledge (KYC) measures. He is currently charged with money laundering, identity theft and unlicensed business opening clauses. Found in Nguyenễn, Philadelphia. Potentially facing 40 years in prison.
U.S. authorities have also taken action against other coin mixing services over the past year. The US Treasury sanctioned Ethereum-based coin mixer Tornado Cash in August 2022. Prior to that, the Treasury sanctioned a lesser-known blender called Blender in May 2022. Recent reports from blockchain surveillance firm Elliptic suggest that the platform may have re-entered the market operating under the Sinbad name.
Although cryptocurrency mixers are used for illegal activities, the sanctions have been met with controversy due to having legitimate privacy practices. A crypto mixer, as we report as Kriptokoin.com, is a service that combines cryptocurrencies of many users to hide the origins and owners of funds. Because Bitcoin, Ethereum, and many other public blockchains are transparent, this level of privacy is hard to achieve otherwise. It is known that hackers use these services extensively, as well as those who want to take legal action anonymously.
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