German authorities have announced the takedown of eXch, a cryptocurrency exchange allegedly involved in money laundering and in supporting criminal operations.
Established since 2014, eXch provided cryptocurrency swapping services and was advertised on underground platforms as lacking anti-money laundering measures, Germany’s Federal Criminal Police Office (BKA) says.
According to the BKA, the exchange was available on both the surface and the dark web, did not require users to identify themselves, and did not store any user data, which made it suitable for concealing fraudulent transactions.
A portion of the $1.5 billion worth of Ethereum stolen on February 21 from Bybit was likely exchanged through eXch, the BKA says. The Bybit hack was attributed to the North Korean state-sponsored group Lazarus.
“The operators of eXch are therefore suspected of commercial money laundering and operating a criminal online trading platform,” a translation of the BKA’s announcement reads.
The Frankfurt am Main Public Prosecutor’s Office and the BKA seized eXch’s servers in the country on April 30, and shut the exchange down.
Roughly two weeks prior, the exchange said in a forum post that it would close shop on May 1, after learning from individuals “in the state intelligence sector” that it was the subject of a law enforcement investigation.
“The goals we certainly never had in mind were to enable illicit activities such as money laundering or terrorism, as we are being accused of now. We also have absolutely no motivation to operate a project where we are viewed as criminals,” the platform’s operators said.
The BKA says eXch’s plan to shut down voluntarily was anticipated, and the takedown operation was performed quickly, to secure evidence, including the platform’s database and approximately €34 million (~$38 million) in Bitcoin, Ether, Litecoin, and Dash.
The Dutch Fiscal Information and Investigation Service (FIOD), which assisted the German authorities with the investigation, announced in a forum post that it was investigating individuals who had used eXch for money laundering and other illicit activities.
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