US Imposes Sanctions on Sinbad Cryptocurrency Mixer Linked to North Korean Hackers

The US Department of the Treasury's Office of Foreign Assets Control (OFAC) has placed the cryptocurrency mixer Sinbad on its sanctions list, alleging the platform's involvement in laundering funds for the North Korean hacker group Lazarus.

According to the statement released on November 29th, OFAC stated that Sinbad had "processed millions of dollars in virtual currencies obtained through hacking attacks." These attacks, including breaches of Horizon Bridge in June 2022, Axie Infinity's Ronin Bridge in March 2022, and Atomic Wallet in June 2023, facilitated the siphoning of approximately $850 million from owners and users.

Wally Adeyemo, Deputy Secretary of the Treasury, emphasized, "Mixing services that enable criminal organizations like Lazarus Group to launder stolen assets will face serious consequences. The Department of the Treasury and its US government partners are ready to utilize all available tools to disrupt virtual currency mixers like Sinbad from facilitating illicit activities."

Sinbad allows users to mix digital assets to ensure transaction privacy and anonymity, employing advanced encryption algorithms and decentralized architecture to safeguard funds from tracking.

This action follows OFAC's listing of the cryptocurrency mixer Tornado Cash in August last year, alongside 39 Ethereum addresses and 6 USDC addresses associated with it. OFAC claimed that since its launch in 2019, Tornado Cash was used to launder over $7 billion in cryptocurrency, with over $455 million linked to the activities of Lazarus Group.

In a similar vein, Tornado Cash was involved in laundering over $96 million from criminals involved in the Harmony network robbery in June 2022. Moreover, it was used to launder $7.8 million stolen from the cross-chain protocol Nomad in early August.

In recent developments, Alexey Pertsev, one of the developers of Tornado Cash, was arrested in Amsterdam. He is charged with "participation in concealing criminal financial flows and facilitating money laundering through the mixing of cryptocurrencies using the decentralized service Tornado Cash."

Furthermore, in August of the current year, the US government formally charged and arrested the founders of the cryptocurrency mixer Tornado Cash. Authorities accused Roman Storm and Roman Semenov of laundering over $1 billion and violating sanctions. The founders are also accused of "conspiracy to conduct an unlicensed money transmitting business."

This move by the US signifies a growing crackdown on cryptocurrency mixers involved in facilitating illicit financial activities, linking them to significant cyber incidents and criminal operations.