Swiped: Feds Take Down Privacy-Focused Crypto Exchange
Authorities have taken action to cease operations of a recognized cryptocurrency platform.
Meet eXch, the cryptocurrency exchange that promised financial privacy and boasted about not complying with anti-money laundering regulations. But the party's over.
Germany's Federal Criminal Police Office (BKA) and Frankfurt's General Public Prosecutor's Office have pulled the plug on this dubious crypto-swapping service.esen, a service that's been in operation since 2014, was shut down at the end of April. The authorities also nabbed around €34 million in cryptocurrencies, including Bitcoin, Ether, Litecoin, and Dash. This seizure is reportedly the third-largest in BKA's history.
Buzzword Bingo Cybercrime Dark Web
eXch was a platform that allowed users to trade various cryptocurrencies, available both on the surface web and the dark net. It advertised its lack of measures against money laundering, and users weren't required to reveal their identities. The exchange famously didn't store any user data.
Since its inception, rumors have swirled that eXch accepted cryptocurrencies of criminal origin, making its operators prime suspects for money laundering and operating an illicit online trading platform. Initially, the operators declared they'd close up shop on May 1, but the authorities, never ones to take a backseat, made a swift move and secured the data.
Some experts speculate that eXch stayed active, despite announcing its closure, by offering API access to business partners, allowing it to continue facilitating money laundering activities.
The Big Score: $1.9 Billion
Since its debut, approximately $1.9 billion in cryptocurrencies have been traded on eXch.
Behind the Closet Doors
eXch's closeted operations have raised eyebrows in the law enforcement and regulatory communities. The shutdown is part of a broader transatlantic operation to address eXch's suspected involvement in money laundering and potential terrorism financing. The exchange has been under investigation for allegedly laundering funds stemming from the Bybit hack, which is one of the largest cyber heists in recent history. Furthermore, eXch's architecture, which mixed user transactions, has been flagged as a potential risk obscuring illicit financial flows.
Wrapping It Up
The takedown of eXch underscores the ongoing struggle to regulate cryptocurrency exchanges and prevent money laundering activities within the digital currency sphere. The shutdown serves as a reminder of the mounting scrutiny from law enforcement and regulatory bodies aiming to combat illicit financial activities in the crypto space.
- The International community, in partnership with Germany's financial and law enforcement agencies, have targeted eXch, a cryptocurrency exchange that promised financial privacy and flouted anti-money laundering regulations.
- The cryptocurrencies seized from eXch, including Bitcoin, Ether, Litecoin, and Dash, amounts to around €34 million, making it the third-largest seizure in German Federal Criminal Police Office's history.
- The eXch platform, available both on the surface web and the dark net, was notorious for its lack of measures against money laundering, and it did not require users to reveal their identities.
- The technology industry and crime-and-justice sector are closely watching the development surrounding eXch, a prime suspect for money laundering and operating an illicit online trading platform.
- Beyond the seizure of €34 million in cryptocurrencies, the investigation into eXch also involves allegations of money laundering stemming from the Bybit hack, one of the largest cyber heists in recent history, and potential terrorism financing.
