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Around $15 million in ether (4,600 ETH) were stolen from Singapore-based Crypto.com. According to on-chain data, the asset is being laundered through Tornado Cash, an Ethereum Mixer, although the company has denied the theft. Last week, Crypto.com tweeted some users reporting "suspicious activity", hence suspending withdrawals for a temporary period. The company has also introduced an upgraded level of security; users will now have to wait 24 hours for any withdrawal.
Tornado cash, launched in early 2022, is an ETH mixer protocol that improves transaction privacy by concealing the on-chain link between the source and recipient of ether. It is a decentralized protocol that uses smart contracts to carry out private transactions on ETH. Version 2 of Tornado cash includes a cryptographic note in the transaction history of ether send that can be used in determining the fund's origin.
ETH mixer or a crypto tumbler is a software program that splits up a transaction, so it's easy to blend different parts of it with other coins. In the end, the sender receives the same number of coins but combined in a completely different set.
Peck Shield, a security consultancy, first spotted the on-chain data and reported that the 4600 ether would be sent through the mixer in batches of 100 ether. Although some say that mixer protocols are used to protect the privacy of politically exposed individuals, they are sometimes used to launder the proceeds of organized crimes. Crypto.com Coin's price jumped over 850% in 2021, backed by an aggressive advertising campaign. The coin has already lost 50% from its November high and is falling further. Crypto.com recently bought naming rights to Staples Center( now the Crypto.com Arena) and signed many other sponsorship deals. According to CoinGecko, Tornado Cash's token TORN rose by almost 9% to $33.31.
So far, Crypto.com hasn't announced any loss of funds, although some customers reported losses of funds. Even if everyone's money is returned, it is yet another warning of the risks involved in investing in digital assets.