The Other Side of DeFi Bridges – Created at the end of 2019 Ethereum, the DeFi ecosystem has since taken a multi-chain turn. Therefore, many bridge services have emerged that allow the transfer of funds between blockchains. However, like any tool, these can be misused.
Half a billion dollars laundered through the DeFi bridge
On August 10, the company Elliptical Connect presented a startling report on some uses of crypto bridges.
Indeed, the latter dealt with a relatively common phenomenon: chain jumping, or sequence jump. This method is especially used by most of the hackers who attacked a crypto protocol.
So chain jumping consists of they send funds from blockchain to blockchain to cover their tracks. Obviously, the means listed are, most of the time, from hacking, ransomware, or fraud. Not surprisingly, the latter use bridge protocols to perform these transfers.
During its research, Elliptic Connect analyzed the activities of many bridges, including RenBridge. The results are not very good.
In total, this is more than 540 million dollars of illegal origin that pass through the RenBridge bridge from 2020. These 540 million are the funds of several hacks:
- $33.8 million from Liquid exchange hack;
- $2.4 million from the Nomad hack;
- $153 million related to Russian ransomware;
- $53 million from attacks on the Costa Rican government;
- $92 million from Ryuk, the ransomware that targeted hospitals around the world.
RenBridge has also been used by North Korean hackers to launder their thefts.
In any case, most of the illegal funds flowing through the bridge come from funds stolen from DeFi hacks.
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Blaming the tool: a good method?
Obviously, RenBridge is not limited to illegal use. Since its inception, RenBridge has recorded over $12 billion in volume. Accordingly, unauthorized use of the Platform is limited to 4% of total consumption.
A relatively low percentage, which raises the following question: is it the tool’s fault?
Indeed, this debate is more current than the mixing service Tornado Cash has entered the US Treasury Theater.
Therefore, many central authorities will tend to blame the tool for the uses it is put to, even though these uses may be anecdotal in terms of general usage.
Moreover, this witch hunt seems to know no bounds. Indeed, the Tornado Cash protocol, aware of the abuse that exists, is tried to introduce restrictions of use. A procedure that will be neither hot nor cold in the US Treasury Department.
At the same time, traditional currencies and the institutions that represent them are, again, not concerned with how they are used. Of course, criminals didn’t wait for the internet or cryptocurrencies to invent money laundering.
For its part, Tornado Cash is trying to somehow survive despite the multiplication of sanctions. in that way, service providers Infura and Alchemy began censoring transactions on the mixer.
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