Crypto Exchange poloniex’s $100 Million Hack Traced to Tornado Cash

$53.5M Million worth of Ether (ETH) related to the November 2023 Poloniex hack has been located at Tornado Cash, a decentralized cryptocurrency tumbler. This phenomenon, shown by PeckShieldAlert, casts a new light on the consequences of one of the most serious cryptocurrency security breaches.

Poloniex hack traced to Tornado Cash

 The Poloniex cryptocurrency exchange suffered an attack on November 10, 2023; thus, the losses were greater than $100 million worth of Ether. Though Poloniex tried to get the stolen funds back, including offering a $10 million reward, the effort was unsuccessful because the hacker was not found. The firm, which is a blockchain security firm, blamed the hack on a “private key compromise.

After the breach, Poloniex put the affected wallets on hold and started investigating them. Nevertheless, the hacker’s goal to return the funds was not material, consequently leaving Poloniex and its users in deep trouble.

Through intense investigations, PeckShield discovered that a major segment of the stolen money, around $53, was actually transferred back to Tornado Cash. The millions had been laundered through Tornado Cash. The hacker moved about 17,800 ETH from different wallets to one Tornado Cash address, making tracing and withdrawing the funds more difficult.

Poloniex security measures and compensation pledge

Although the crypto-exchange was shut down, Poloniex continued its operations, allowing investors to deposit and withdraw cryptocurrencies. The exchange was also ready to take the risk of enhancing security by hiring a leading auditing firm to conduct a detailed audit. After finishing the audit, the exchange promised to resume deposit and withdrawal services immediately.

Justin Sun, the CEO and founder of Poloniex, TRON, assured the users affected by the issue that they would be compensated fully and that Poloniex has a very strong financial condition. Sun also stated that he intends to work with other exchanges to get back the funds that were stolen due to the security breach, showing his dedication to dealing with the aftermath of the hacking.