An unidentified decentralized crypto exchange and Nirvana Financial, a decentralized financial yield protocol, were both compromised in a hacking incident, which a software engineer admitted to.

A maximum five-year prison term awaits him for wire fraud and money laundering charges. According to the US Attorney’s Office, this was the first smart contract hacking case to result in a conviction.

Shakeeb Ahmed has agreed to turn over $12.3 million, including $5.6 million in unlawfully obtained cryptocurrencies, as part of his guilty plea.

Exploiting Smart Contracts: Ahmed’s Crypto Heist

This appeal is a result of his role in taking advantage of flaws in Nirvana Finance’s and another anonymous decentralized digital currency exchange’s smart contracts.

Ahmed hacked two decentralized cryptocurrency exchanges in July 2022 using his skills in reverse engineering smart contracts and blockchain audits, according to a press release on December 14, 2023.

The statement claims that he used a variety of strategies, including cryptocurrency mixers and foreign exchanges, to launder the stolen assets from both sites.

Ahmed, a former engineer at Amazon, returned everything to the exchange, with the exception of $1.5 million, and the exchange chose not to notify the police about the event.

“Ahmed used his technical knowhow to steal over $12 million and tried to cover his tracks by swapping stolen crypto for Monero, using cryptocurrency mixers, hopping across blockchains, and utilizing overseas crypto exchanges,” the statement read.

Total crypto market cap at $1.557 trillion on the daily chart: TradingView.com

The exchange allowed users to buy and sell different digital currencies and paid those customers who deposited crypto to increase the market liquidity.

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Author: Christian Encila

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