Key Highlights:
- A U.S. government wallet, holding funds seized from the 2016 Bitfinex hack, has allegedly been hacked, with $20 million suddenly transferred out.
- The hacker has already sent one-third of the funds to exchanges, sparking fears of laundering on a massive scale.
Paradisers! Did the U.S. government just lose $20 million in crypto to a hacker? On October 24, Arkham, the blockchain intelligence platform, detected a transfer of USDC, aUSDC, USDT, and ETH worth a combined $20 million from a wallet tied to the U.S. government.
This wallet held crypto seized from the 2016 Bitfinex hack, and these funds were assumed locked up. But the startling transfers suggest someone cracked open the vault, or worse, they were never properly secured to begin with.
The Wallet Drama Unfolds: Where Did the Funds Go?
According to Arkham, the funds were routed to a wallet labeled 0x348, which began converting assets to ETH and sending them off to exchanges. ZachXBT, a well-known on-chain detective, further confirmed the suspicion, pointing out the assets landing on exchanges like Nexchange and Switchain. And here’s the twist, $6.5 million in stablecoins had been generating yield on Aave, implying that Uncle Sam’s wallet was quietly compounding interest on its loot.
As of now, the hacker’s wallet still holds a stash of nearly $13.2 million, mostly as aUSDC, tokens deposited on Aave. The seized assets included 13.7 million aUSDC, 5.45 million USDC, 1.12 million in USDT, and $446,920 in ETH.
A Government Crypto Fumble?
It’s a reminder that in crypto, even a government wallet isn’t sacred. This eyebrow-raising event comes as the U.S. government’s crypto holdings soar over $14 billion, most of it in Bitcoin. So the question remains: if they can’t keep their digital assets safe, what does that mean for the rest of us? And, of course, in true crypto style, the online reaction is a mix of disbelief, amusement, and, yes, plenty of “I told you so.”
