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Tornado Cash Accounts For 53% of Stolen NFT

Edith Muthoni Freelance Writer Author expertise
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Many have hailed non-fungible tokens (NFTs) as potential game changers in the financial landscape. They offer a faster, more efficient way to trade and manage digital assets than traditional methods like paper certificates or centralized exchanges.

However, with any new technology comes risk. And in the case of NFTs, that risk comes in the form of scams. One of the most prevalent forms of NFT scams is laundering. This is when stolen NFTs are mixed with legitimate tokens to disguise their origins. The aim is to complicate the tracking of stolen assets.

One leading platform for laundering NFTs is Tornado Cash, an American mixer. According to a TradingPlatforms.com data presentation, 53% of all stolen NFTs are laundered through this platform. So what makes Tornado cash a favorite for NFT launderers?

According to TradingPlatforms’ financial expert Edith Reads, there are several reasons why Tornado Cash is popular for laundering NFTs. She holds, “Firstly, it is one of the most well-known mixers on the market, making it easy for criminals to use it to hide their tracks. Secondly, it offers high levels of anonymity, which makes it difficult for authorities to track down the perpetrators.”

Treasury Department’s Sanctions

Tornado Cash is no stranger to controversy. The U.S. Treasury’s Office of Foreign Assets Control sanctioned the mixer for abetting cryptocurrency laundering early last month. The office alleges that Tornado Cash has facilitated the laundering of crypto assets exceeding $7 billion since 2019.

While the Treasury Department’s actions have caused some to question the legality of using Tornado Cash, the mixer remains a popular tool for those looking to hide their crypto holdings from prying eyes.

Critics argue that it enables criminals to launder money with impunity. However, supporters of the service say that it provides much-needed privacy for cryptocurrency users. 

In a world where governments are increasingly monitoring financial transactions, Tornado cash allows people to keep their finances private.

One of the most prominent users of Tornado Cash is the Lazarus Group, a North Korean state-sponsored hacking group that has been active since at least 2007. 

The group is perhaps best known for its involvement in the Sony Pictures hack in 2014, but they have also been linked to several other major hacks, including the WannaCry ransomware attack in 2017.

The Lazarus Group has recently turned to crypto laundering to monetize its hacking activities. In 2021 alone, they stole over $400 million worth of cryptocurrencies.

The group’s most recent heist was the $100 million Harmony Bridge hack. But that’s not all – they were also behind the $7.8 million Nomad heist. And these are just a few of their many exploits. 

By funneling stolen funds through Tornado Cash, they can obfuscate the trail and make it much more difficult for authorities to trace the money. As a result, Tornado Cash has become an essential tool for the Lazarus Group’s illicit operations.

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Edith Muthoni Freelance Writer

Edith Muthoni Freelance Writer

Edith is a dynamic and seasoned finance writer with a focus on crypto and trading - featured on different platforms, including Cryptopolitan.com, Insidebitcoins.com, and Learnbonds.com. With a Bachelor's Degree in Actuarial Science from Strathmore School of Business, Edith combines her education and experience to analyze complex market trends. This solid foundation also enables her to simplify complex trading strategies, delivering informative content, relevant to our fast-paced economy.

Edith's passion for finance and cryptocurrency keeps her at the forefront of industry news. She creates content that empowers her readers. She’s also a personal finance coach, providing expert advice on trading and other intricate finance issues