Dark web Crypto “Laundromat” ChipMixer shut down by authorities

by Arthur · March 15, 2023

One of the largest crypto-focused cybercriminal organizations known to the underworld, Chipmixer, has been shut down in a joint effort by German and US authorities. According to a Europol press releasethe investigation was also supported by the Belgian, Polish and Swiss authorities.

The crypto Mixer organization was accused of being involved in money laundering activities on four servers, over 19,000 Bitcoin in 55 transactions worth approximately $45 million, where 7 terabytes of data were seized.

What is ChipMixer and how they pulled off Crypto’s greediest heist

ChipMixer is an unlicensed cryptocurrency mixer created in 2017 that specializes in cutting the tracks associated with digital assets. According to Europol, the ChipMixer software allowed criminals to hide the blockchain trail of funds, making it “more attractive” to cybercriminals trying to launder illicit proceeds for criminal activities such as drug trafficking, weapons, ransomware attacks and payment card fraud.

The deposited funds were converted into “chips”, small tokens of comparable value, further mixed, allowing criminals to anonymize all traces of where the original funds originated.

In addition, the service was offered on “the clear” and on the dark web. ChipMixer offered its customers complete anonymity to avoid the law. Authorities claim that this service is often used before criminals launder digital assets and are further redirected to cryptocurrency exchanges.

Allegedly, not only the criminals were involved, according to Europol, cryptocurrency exchanges were also involved in this form of organized crime, where at the end of the process the “cleaned” digital asset was exchanged for other cryptocurrencies, or directly to the authorities. issued currency (FIAT), through ATMs or bank accounts.

Over $3 million in digital assets stolen

According to the investigation of the criminal organization, the platform may have facilitated the laundering of 152,000 Bitcoin, valued at over 3 million dollars in digital assets. Many were linked to dark web markets, ransomware groups, illegal goods, trafficking and stolen crypto assets.

Officials conducted the investigation using information obtained after the shutdown of the Hydra dark web platform. This online criminal marketplace allowed users, primarily in Russian-speaking countries, to buy and sell illegal goods and services, uncovering millions of dollars in transactions.

In addition, authorities are investigating the possibility that some of the digital assets stolen following the 2022 bankruptcy of a major cryptocurrency exchange were laundered through the cybercriminal organization ChipMixer.

Europol reported that it was assisting the investigation with operational and forensic analyses. On the other hand, the United States joined the Federal Bureau of Investigation (FBI), Homeland Security, and the Department of Justice to take down the criminal crypto network.