Hacker Returns $19 Million Stolen from U.S. Government

A mysterious exploit drained over $20 million from a wallet controlled by the U.S. government on Thursday evening, only to return the majority of the funds early Friday morning.

Still, authorities are missing $700,000 of funds sent to instant exchanges such as HitBTC, Switchain, and N Exchange. Though some users thought the potential attacker had sent the funds to Binance, these are, in fact, nested exchanges which use Binance for liquidity.

On-chain surveillance firm Arkham Intelligence flagged the movement of funds, which blockchain sleuth ZackXBT claimed “looked nefarious.”

The assets, now mostly back in the hands of U.S. authorities, belong to a wallet seized by the Department of Justice in 2022 as part of the infamous Bitfinex hack in 2016. Roughly 120,000 BTC ($72 million at the time) were drained in 2,000 transactions. When seized two years ago, the value of the Bitcoin had ballooned to $3.6 billion.

Roughly 60 minutes after the government-controlled wallet received the funds back, they were sent to another address. A small amount of ETH, likely a test transaction, was followed by a $6.1 million transfer. Similarly, a small amount of aUSDC, an Aave-based yield-bearing stablecoin, was sent, followed by an $11.6 million transaction.

A variety of coins, such as USDC, TRUMP, MTV, USDT, and WATER, also appear in the government-controlled wallet.