Jamal Al-Farouq On December 14, the Southern District of New York’s U.S. Attorney disclosed that Shakeeb Ahmed had admitted guilt to computer fraud. Ahmed was implicated in the hacking of two decentralized cryptocurrency exchanges. Efforts to conceal his involvement were made by using international crypto exchanges and converting the pilfered assets into the privacy-oriented cryptocurrency monero.
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Hacker Negotiates for Higher ‘Bounty’
Shakeeb Ahmed, identified as the hacker of a decentralized crypto exchange, has confessed to computer fraud. This admission comes with an agreement to surrender assets worth over $12.3 million. U.S. Attorney Damian Williams revealed that Ahmed also accepted responsibility for the July 2022 hack of the decentralized finance (defi) platform Nirvana Finance.
In a December 14, 2023 statement, Williams explained that Ahmed, a seasoned security engineer, has consented to return the stolen cryptocurrency. He detailed Ahmed’s July 2-3 breach of the decentralized platform, exploiting a smart contract flaw. This exploitation involved the insertion of erroneous pricing data, culminating in roughly $9 million in exaggerated fees.
The statement further disclosed that Ahmed initially contacted the platform, leading to a deal where he would keep $1.5 million of the digital assets, provided the issue was not escalated to law enforcement.
On July 28, Ahmed also targeted Nirvana Finance, profiting $3.6 million. Nirvana Finance proposed a “bug bounty” of $600,000 to Ahmed for the return of the assets, yet Ahmed insisted on $1.4 million.
Limited Efficacy of Crypto Mixers
Post-attack, Ahmed sought to obscure his actions through the use of foreign crypto exchanges and converting the stolen assets to monero. However, Williams’ statement indicates that these attempts were ultimately futile.
Williams commented, “Ahmed leveraged his technical expertise to embezzle over $12 million. Despite his use of crypto mixers, blockchain hopping, and foreign exchanges to exchange stolen crypto for monero, we have proven such tactics ineffective. This conviction underscores that regardless of the complexity of the crime, fraud remains fraud, and perpetrators will be promptly apprehended and prosecuted.”
Ahmed’s search history, revealing plans to leave the U.S. shortly after the hack, was an additional factor in the case. As per the statement, U.S. Judge Victor Marrero is scheduled to sentence Ahmed on March 13, 2024.
We invite your opinions on this development. Share your thoughts in the comments below.
Frequently Asked Questions (FAQs) about cryptocurrency hacking
Who is Shakeeb Ahmed and what was he accused of?
Shakeeb Ahmed is a security engineer who was accused of hacking two decentralized cryptocurrency exchanges. He pleaded guilty to computer fraud and agreed to forfeit over $12.3 million.
What was the nature of Ahmed’s hacking activities?
Ahmed exploited vulnerabilities in the smart contracts of decentralized platforms, inserting fake pricing data to generate inflated fees. His activities included attacks on an unnamed crypto exchange and the defi platform Nirvana Finance.
How did Ahmed attempt to cover his tracks after the hacks?
Ahmed tried to obscure his actions by using overseas crypto exchanges and swapping the stolen assets for the privacy coin monero. He also used cryptocurrency mixers and hopped across blockchains.
What was the outcome of the legal proceedings against Ahmed?
Ahmed pleaded guilty to computer fraud and agreed to return the stolen cryptocurrency. He is scheduled to be sentenced by U.S. Judge Victor Marrero on March 13, 2024.
What does this case indicate about the efficacy of crypto mixers in hiding fraudulent activities?
The case demonstrates that, despite Ahmed’s use of crypto mixers and other tactics to disguise his fraudulent activities, these methods were ultimately ineffective in evading detection and prosecution.
More about cryptocurrency hacking
- U.S. Attorney’s Official Statement
- Overview of Cryptocurrency Fraud Cases
- Legal Aspects of Computer Hacking
- Understanding Decentralized Finance (DeFi)
- Monero and Privacy in Cryptocurrency Transactions
- Cybersecurity and Blockchain Vulnerabilities
5 comments
glad to see the legal system catching up with these cyber criminals, but what about the victims? hope they get their assets back soon.
surprised ahmed thought he could outsmart the authorities by using crypto mixers and swapping for monero. a classic case of overconfidence leading to downfall.
interesting to see how Ahmed used monero and other tactics, but still got busted. Shows that there’s really no perfect crime in the digital age.
this is why we need more robust security measures in decentralized platforms, can’t have hackers like ahmed exploiting vulnerabilities and getting away with millions!
wow, just shows that no matter how smart these hackers think they are, they eventually get caught.. justice served I guess!