ChipMixer is a very popular cryptocurrency exchange among people wishing to remain anonymous. Being founded in 2017, the platform allows users to mix their cryptocurrencies in order to hide their identity. In its near 6 year run, the platform managed to attract all sorts of cyber-criminals from across the world. With that, came law enforcement attention, and a covert operation to take down the site. Today a large scale operation was unveiled, with ChipMixer now in the hands of authorities. Over 40 million dollars were seized in the process.
About Chip Mixer.
During its run, ChipMixer managed to gain a reputation as one of the longest running crypto mixers. According to authorities, the founder is a Vietnamese citizen going by the name 'Minh Quoc Nguyen'. His website, reportedly had a much wider reach than typical dark-net criminals. It has been reported that Russian and North Korean spies used the website to launder money. Over the years, the platform has laundered over 3 billion dollars.
The website was available both through tor, and the clear-net. Europol claims that infamous ransom attackers used the service to launder their funds. This includes Zeppelin, SunCrypt, Mamba, Dharma and Lockbit. One of these groups was responsible for the infamous Kaseya ransomware. The breach reportedly affected over 1,500 businesses. In total, it estimated that hackers laundered over $700 million worth of crypto on ChipMixer. The platform also laundered huge sums of money for dark-net markets and shops. Over $220 million, with Hydra market alone accounting for over $120 million.
What are Cryptocurrency Mixers?
Cryptocurrency mixers work by hiding the origin of the funds. The need for this stems from KYC regulations, as criminals have to provide identity to initially buy cryptocurrencies. When mixing coins, funds from multiple users are initially placed in one wallet. They are then shuffled around different wallets in smaller batches. The mixed pool of funds is then distributed back to the different users initiating the exchange. Authorities can know that someone has mixed their coins, but they cannot identify where they went. (learn more about Cryptocurrency mixers)
Official Operation against ChipMixer.
The end of ChipMixer came as a surprise to many considering its age. The platforms end came as part of the largest cyber-law enforcement operations in recent times. The process involved authorities from all around the world. This includes the US, Germany, Belgium, Poland and Switzerland. The European Joint Cybercrime Action Taskforce headed the operation. Since many details are still unknown, it is unclear when the investigations initially started. Being this size, it is likely that is has started over a year ago.
On March 15, the website servers were officially seized by authorities. The platforms GitHub page was also taken offline. Since authorities accessed the servers, they managed to seize over $46 million in cryptocurrencies. This was an easy task as the private keys for the wallets were also located on the servers. Users who were in the process of mixing their funds received nothing.
It is unclear if any arrests have been made at this time. Charges were filed against the founder of ChipMixer by the Pennsylvania's Attorneys office. Minh Quoc Nguyen, aged 49 is believed to be the main person behind the mixer from the start. Sources also reported that he has been linked to different social accounts promoting the platform.
The expected aftermath.
Users of the platform seem to have trusted it with all their crimes. It was believed that no transaction logs of any sorts were kept on the servers. As it turns out they might have made a mistake. Authorities behind the operation claim to have accessed over 9TB (9,000GB) of information. It is unclear if these are transaction logs, but if so, then this is bad news. With enough time, and possibly an advanced algorithm, law enforcement can start tracking criminals.
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