Hackers Exploit Mining Pools to Launder Funds from Ransomware

• Hackers are using mining pools as mixers to launder funds acquired through ransomware attacks.
• A wallet linked to ransomware attacks funneled funds through a mining pool to make it seem like the digital assets were earned through mining.
• Cryptocurrency exchanges and mining pools can reduce illicit activities by implementing comprehensive wallet screening processes and Know Your Customer (KYC) measures.

Hackers Laundering Funds Through Mining Pools

A new report from blockchain analytics firm Chainalysis has revealed how hackers are using mining pools as mixers to launder funds acquired through ransomware attacks. According to the report, a highly active wallet address from a “mainstream exchange” has received nearly $100 million in digital assets, with $19.1 million coming from wallets and $14.1 million from mining pools linked to ransomware.

Mining Pool Functioning as Mixer

The hackers send funds to the exchange via a mining pool, which acts as a mixer and makes the origin of the funds obscure. This creates a smokescreen leading observers to believe that the funds are earned through mining rather than being obtained illegally through ransomware attacks.

Increasing Value Sent From Ransomware Wallets

Chainalysis also reported an increase in value sent from ransomware wallets to mining pools, citing an instance where an exchange wallet address had received $158.3 million from such addresses since 2018.

Solution To Reduce Illicit Activities

The blockchain analysis firm suggested that cryptocurrency exchanges and mining pools can reduce illicit activities by implementing comprehensive wallet screening processes and Know Your Customer (KYC) measures that reject funds coming from suspicious or illegal addresses.

Conclusion

This new report from Chainalysis shows just how creative hackers can be when it comes to laundering money gained through illegal means, emphasizing once again how important it is for crypto businesses to implement stringent security procedures in order protect their customers’ funds and ensure compliance with regulations worldwide.