Major crypto exchange Binance claims to have found a way to make sure North Korean hackers don’t use the platform to launder illicit funds.
According to a Thursday report from CoinDesk, Binance’s head of financial crime compliance Tigran Gambaryan said the exchange had been fairly successful in preventing these groups from circumventing controls and identifying the entities that they try to spoof.
“We kicked their ass enough that they’re actually able to recognize that Binance was not the place for them,” said Gambaryan in a speech at CoinDesk’s Consensus 2023 event.
Gambaryan was referring to North Korean cybercrime groups that have been notorious for orchestrating some of the biggest hacks in the crypto space. The State-backed Lazarus Group was behind a $100 million exploit of the Harmony Bridge in 2022. The U.S. Treasury’s Department Office of Foreign Assets Control (OFAC) went on to sanction coin mixers like Tornado Cash, alleging that the group used the service to launder funds.
While the wallets associated with the attackers have been seen swapping their stolen funds on-chain on a few occasions, some of these attempts have been intercepted by exchanges. In January, the Lazarus Group moved 41,000 ETH, worth around $63.5 million at the time, through coin mixing protocol Railgun and deposited the funds on three exchanges, including Binance.
“We detected Harmony One hacker fund movement. They previously tried to launder through Binance and we froze his accounts. This time he used Huobi. We assisted Huobi team to freeze his accounts. Together, 124 BTC have been recovered. CeFi helping to keep DeFi #SAFU,” tweeted Binance CEO CZ at the time.
A month later, blockchain analytics firm Elliptic said it had collaborated with both Binance and Huobi and frozen $1.4 million worth of the hackers’ loot.
Regardless of its actions to stop bad actors and assist law enforcement on these matters, Binance has found itself in the crosshairs of the U.S. Commodity Futures Trading Commission (CFTC). In a lawsuit filed last month, the regulator alleged that Binance and its CEO violated trading and derivatives regulations in the U.S. and took a calculated approach to onboard U.S. customers.