Hackers Used Adopt Tornado Cash’s Protocol in Platform’s Exploit By CoinEdition

• Tornado Cash Governance token, TORN, was transferred using Tornado Cash.
• The hacker deposited $6,000 TORN to Bitrue, a cryptocurrency exchange based in Singapore.
• 0,000 stolen TORN was swapped for ETH and 372 ETH transferred into Tornado Cash.

A hacker who stole the Tornado Cash Governance token, TORN, has used the obfuscation protocol to transfer the stolen funds. According to PeckShield, the blockchain security and data analytics company.

#PeckshieldAlert Tornado Cash Governance Exploiter has deposited 6K $TORN to #Bitrue. And swapped ~380K $TORN for $ETH and then transferred 372 $ETH into Tornado Cashhttps://t.co/3fEa1kYFaz pic.twitter.com/BzqagupO5c

— PeckShieldAlert (@PeckShieldAlert) May 21, 2023

PeckShield reported the hacker deposited $6,000 TORN to Bitrue, a cryptocurrency exchange based in Singapore and available to users across the globe. The Tornado Cash exploiter swapped about 380,000 TORN for ETH and transferred 372 ETH into Tornado Cash.

The Tornado Cash exploit depicts the proverbial situation of using one’s weapon to fight against them. A responder on Twitter who replied to PeckShield’s report likened the development to the US war in Afghanistan that ended with the Taliban returning to power. The responder said,

“Get me right. So the hacker of Tornado Cash is using Tornado to wash? So TORN cannot become zero as the function is fully functional to steal tornado governance tokens. That is like the US fighting for 20 years in Afghanistan to replace the Taliban with Taliban.”

Tornado Cash is an open-source decentralized crypto tumbler that runs on protocols compatible with the Virtual Machine (EVM). It works as a coin mixer that leverages smart contracts to facilitate ETH deposits and multiple withdrawals.

Tornado Cash suffered a governance attack, with the attackers taking control of the protocol and granting themselves 1.2 million votes through a malicious proposal. As a result, the protocol’s native cryptocurrency, TORN, lost over 35% of its value in less than 24 hours. Binance, one of the world’s largest crypto exchanges, has suspended TORN deposits, citing precautionary measures.

However, Huobi and Poloniex, two of the world’s renowned cryptocurrency exchanges, announced that TRON deposits and withdrawals remain active on their platforms. They also claim to be monitoring the situation closely and will not hesitate to adjust their policies as required to ensure customers’ security.

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