Kucoin announced through its CEO Johnny Lyu that they have found the hackers who compromised close to $280 million of the exchange’s funds in last week’s hack.
Lyu tweeted this update over the weekend as crypto markets struggled in the red zone following the Kucoin hack, BitMEX indictments, and the news of President Trump contracting COVID 19.
The hack update noted that authorities and law enforcement, in particular, are now involved in the matter,
A quick update since my last livestream on Sep 30.
After a thorough investigation, we have found the suspects of the 9.26 #KuCoin Security Incident with substantial proof at hand. Law enforcement officials and police are officially involved to take action.
— lyu_johnny (@lyu_johnny) October 3, 2020
This update comes as a reprieve to Kucoin stakeholders, although the Singapore based exchange had assured the crypto community that funds were SAFU. While its funds in cold storage remained untouched, the hackers had managed to siphon around $280 million from hot wallets and are in the process of dumping the hack proceeds for value realization.
However, this seems not to be going so well for the group, which has only sold $13 million worth of the stolen funds. These were sold through decentralized exchanges, including Uniswap, Kyber Network, Tokenlon, and DEX.AG. As for the rest, Lyu now says that an additional $64 million has been frozen in collaboration with other CeFi providers, bringing the total to $204 million.
Besides the updates, Lyu also signaled that Kucoin is gradually returning to full functionality and supported deposits and withdrawals of 31 tokens as of October 3. In an earlier follow-up Livestream on September 30, the Kucoin CEO had acknowledged the hack as part of growing bigger,
“As a crypto team just turned three years old, although we never slack off on security-related issues, we couldn’t dodge the cruelest coming-of-age ceremony that every predecessor used to embrace.”
While this hack may have hit hard, one thing that emerged is the collaborative effort by crypto projects to curtail the movement of ‘compromised’ funds. Some projects like Velo Labs have gone to re-deploying their smart contracts to freeze the funds. Nonetheless, this has also sparked controversy on the whole aspect of decentralized ecosystems.