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James Carter

May 18, 2023

US DOJ Battle Against DeFi Hacks and Thefts

The United States Department of Justice has taken note of the alarming rate at which DeFi hacks are occurring. According to various reports published not long ago by the Financial Times. The Department of Justice (DoJ) has referred to these thefts and breaches as a “pretty significant issue.”

In addition to the hacks and exploits that have been carried out by other malicious actors. There have been occasions in which North Korean hackers have targeted DeFi platforms, which has led to the theft of billion of dollars in funds.

According to a report published by De.Fi Security in January 2023, a total of $49 billion was stolen in cryptocurrency transactions in 2022.

US DOJ Battle Against DeFi Hacks and Thefts

Researchers released their findings in another report, which stated that 97% of all crypto thefts originated through DeFi protocols.

According to reports, cybercriminals operating out of North Korea were responsible for the theft of $1.7 billion worth of cryptocurrency in 2022.

Because of these losses, which add up to billions of dollars, the U.S. Department of Justice has started a search for hackers and crooks who break into wireless networks.

Department Of Justice Kicks Off a Manhunt For DeFi Bad Actors

According to the story from the Financial Times, the Director of the Department of Justice, Eun Young Choi, has stated that the department will focus on preventing thefts of DeFi and hacks that are related to chain bridges.

According to Choi, the matter is crucial due to the fact that “state-sponsored hackers” from North Korea are currently the leading players in crypto attacks and vulnerabilities.

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The first person to hold this position as Director of the Department of Justice’s National Cryptocurrency Enforcement Team (NCET) was Eun Young Choi.

On February 17, 2022, the agency made an announcement indicating that Ms Choi is an experienced prosecutor who has approximately ten years of expertise in the field.

The Department of Justice (DOJ) recently reported an increase in the number of illegal transactions involving distributed ledger technology and digital assets.

These technologies make it easier to commit a variety of crimes, including the illegal trafficking of narcotics, hacking, extortion, cyberattacks, and money laundering.

Cybercrime, cryptocurrency theft, money laundering, and asset forfeiture will all be monitored by the NCET inside the Department of Justice.

However, “mixing and tumbling services” will be the focus of the investigation, and there was no explicit statement made regarding crackdowns on DeFi hackers and thieves.

The DOJ Will Target Firms That Commit Or Facilitate Crimes, Choi

Choi underscored the Department of Justice’s commitment to cracking down on businesses that are engaging in illegal activities or that turn a blind eye to the law while speaking at the Financial Times Crypto and Digital Assets Summit.

Choi brought particular attention to the role of businesses that obfuscate transaction trails, which in turn makes it possible for money laundering and facilitates illegal actions.

The Choi believes that there will be a “multiplier effect” in stopping bad actors from readily profiting from their illegal actions if they target the source of these crimes. This will be accomplished by targeting the source of these crimes.

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DeFi Hacks and Thefts

Additionally, the Director of NCET sounded the alarm about the enormous increase in the utilization of digital assets for criminal operations during the course of the previous four years.

In addition to the hacks that were revealed for DeFi in 2022, malicious actors have continued to make use of these platforms in 2023. On March 13, for example, Euler Finance experienced a catastrophic loss that was valued at approximately $196 million in DAI, USDC, stETH, and WBTC.