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Crypto Exchange Hacker Sentenced To 3 Years In Prison For Stealing $12 Million

Key Points:

Shakeeb Ahmed was sentenced to three years in prison for hacking two DEXs and stealing over $12 million.
The crypto exchange hacker utilized his expertise in smart contract reverse engineering to orchestrate the cyberattacks.
Despite negotiations and attempts at restitution, Ahmed’s actions led to significant financial losses for the targeted platforms.

Shakeeb Ahmed, a U.S. citizen, and former senior security engineer, has been sentenced to three years in prison by U.S. District Judge Victor Marrero for orchestrating cyberattacks on two decentralized cryptocurrency exchanges, resulting in the theft of over $12 million in cryptocurrency.

Crypto Exchange Hacker Sentenced: $12M Hack Fallout

Ahmed, who admitted guilty to computer fraud, utilized his expertise in reverse engineering smart contracts and blockchain audits to carry out the hacks.

The attacks occurred in July 2022, targeting a decentralized cryptocurrency exchange and Nirvana Finance. The crypto exchange hacker employs various techniques, including fake pricing data manipulation and exploiting vulnerabilities in smart contracts, to siphon off funds.

Despite negotiating with the crypto exchange to return stolen funds, Ahmed ultimately absconded with $1.5 million. In the case of Nirvana, he refused a $600,000 “bug bounty” and demanded $1.4 million, leading to the shutdown of the platform after he stole approximately $3.6 million.

Laundering Techniques Revealed: Ahmed’s Sophisticated Methods

Prosecutors initially sought a four-year sentence, considering Ahmed’s acceptance of responsibility and restitution. In addition to his prison term, Ahmed will forfeit $12.3 million and pay $5 million in restitution.

To conceal the illicit gains, the crypto exchange hacker employs sophisticated laundering techniques, including token-swap transactions, blockchain bridging, and the use of anonymized cryptocurrencies like Monero. However, Ahmed’s criminal actions have led to significant financial losses and the closure of the targeted platforms.

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Harold

With a passion for untangling the complexities of the financial world, I've spent over four years in financial journalism, covering everything from traditional equities to the cutting edge of venture capital. "The financial markets are a fascinating puzzle," I often say, "and I love helping people make sense of them." That's what drives me to bring clear and insightful financial journalism to the readers of Coincu.