{"id":22604,"date":"2023-09-20T05:39:28","date_gmt":"2023-09-20T05:39:28","guid":{"rendered":"https:\/\/nftandcrypto-news.com\/crypto\/criminals-more-reliant-on-cross-chain-bridges-than-ever-after-mixer-crackdowns\/"},"modified":"2023-09-20T05:39:30","modified_gmt":"2023-09-20T05:39:30","slug":"criminals-more-reliant-on-cross-chain-bridges-than-ever-after-mixer-crackdowns","status":"publish","type":"post","link":"https:\/\/nftandcrypto-news.com\/crypto\/criminals-more-reliant-on-cross-chain-bridges-than-ever-after-mixer-crackdowns\/","title":{"rendered":"Criminals more reliant on cross-chain bridges than ever after mixer crackdowns"},"content":{"rendered":"
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Cybercriminals have accelerated their shift away from crypto mixers for cross-chain bridges over the past year, according to blockchain forensics firm Elliptic.<\/p>\n

In June and July, nearly all of the crypto stolen was laundered through cross-chain bridges, Elliptic\u2019s data shows\u00a0a complete reversal from the first half of 2022. <\/p>\n

In a Sept. 18 blog post, Elliptic explained the cross-chain crime trend is due to the \u201ccrime displacement\u201d effect \u2014 where criminals move to a new method to carry out the illicit activity when the existing method gets over-policed. However, the shift to cross-chain bridges is rising ahead of their projections.\u00a0<\/p>\n

Proportion of funds laundered between cryptocurrency mixers and cross-chain bridges between January 2022 and July 2023. Source: Elliptic.<\/em><\/figcaption><\/figure>\n

Between July and September 2022, the ratio of laundered funds passing through mixers vs. cross-chain bridges flipped, corresponding to the U.S. Office of Foreign Asset Control\u2019s sanctioning of Tornado Cash in August 2022, said the firm. <\/p>\n

Elliptic said many cybercriminals, like the North Korean-backed Lazarus Group, flocked to the Avalanche bridge after the sanctions.<\/p>\n

This same bridge was reportedly used recently by the Lazarus Group to facilitate some of the stolen funds in Stake\u2019s $41 million exploit on Sept. 4, according to blockchain security firm CertiK.<\/p>\n

Crypto mixers saw a small comeback between November 2022 and January 2023, due to the shutdown of RenBridge \u2014 which closed in December after its financer, Alameda Research collapsed from FTX\u2019s bankruptcy.<\/p>\n

Elliptic estimates that RenBridge facilitated $500 million in laundered funds throughout its operation.<\/p>\n

However, shortly after, criminals have moved back to cross-chain bridges again, even more than before.<\/p>\n

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Chain-hopping via bridges has become one of the most popular money laundering methods for illicit actors. That’s been a problem for crypto investigators \u2014 until now. Meet TRM Phoenix \u2014 automated cross-chain tracing through 12+ bridges & services: https:\/\/t.co\/OziATjlO4P pic.twitter.com\/7QsLthn180<\/a><\/p>\n

\u2014 TRM Labs (@trmlabs) August 25, 2022<\/a><\/p><\/blockquote>\n

Related: <\/em><\/strong>3 steps crypto investors can take to avoid hacks by the Lazarus Group <\/em><\/strong><\/p>\n

Elliptic said that criminals may be preferring cross-chain bridges as it is difficult for blockchain forensic firms to track illicit activity across chains in a scalable manner. <\/p>\n

\u201cCriminals are aware that legacy blockchain analytics solutions do not have the means to trace illicit blockchain activity across blockchains or tokens in a programmatic or scalable manner.\u201d<\/p><\/blockquote>\n

In addition, many of these stolen tokens are only exchangeable through cross-chain bridges, while most of these DeFi services do not require identity verification to use, Elliptic explained.<\/p>\n

The firm estimates that $4 billion in illicit or high-risk cryptocurrencies have been laundered through cross-chain bridges since 2020.<\/p>\n

Magazine: <\/em><\/strong>$3.4B of Bitcoin in a popcorn tin \u2014 The Silk Road hacker\u2019s story<\/em><\/strong><\/p>\n<\/div>\n