- Privacy-focused crypto exchange eXch is shutting down on May 1 following accusations of involvement in the $1.4 billion Bybit hack.
- The closure comes amid an “active transatlantic operation” that could potentially lead to money laundering and terrorism charges against team members.
- eXch previously acknowledged processing “a minor part” of the stolen Ethereum, while denying deliberate involvement with North Korea‘s Lazarus Group.
Privacy-focused cryptocurrency exchange eXch announced Thursday it will cease operations on May 1 amid allegations connecting it to the $1.4 billion Bybit hack. The exchange cited an “active transatlantic operation” targeting its infrastructure and potential money laundering and terrorism charges against team members as reasons for the shutdown.
eXch CEO Johann Roberts told Decrypt that the decision came after receiving information from a “verified whistleblower from the DOJ” who provided “enough real data” to make the situation untenable. “We don’t see any point in operating in a hostile environment where we are the target of SIGINT simply because some people misinterpret our goals,” the company stated in its announcement.
The exchange, known for operating without typical KYC (know-your-customer) requirements, will maintain API access for partners until the shutdown date. After May 1, a new management team will determine the platform’s future.
North Korean Connection and Hack Involvement
The FBI previously linked North Korea‘s Lazarus Group to the February Bybit hack. On-chain investigators reported an unusual surge in Ethereum volume through eXch immediately after the theft, raising suspicions about the platform’s role in processing stolen funds.
eXch initially denied allegations, stating: “We are not laundering money for Lazarus/DPRK.” The company blamed outdated data from its third-party AML screening provider, claiming it took approximately 12 hours to update information on compromised addresses.
However, in a subsequent statement to Decrypt, eXch acknowledged processing “vastly a minor part” (approximately 90,000) of the 401,346 ETH stolen from Bybit. The exchange justified its lack of cooperation with Bybit by citing “direct attacks” on eXch’s reputation in the past.
Criticism of Industry Practices
In its final communications, eXch criticized what it called “nonsensical policies” regarding anti-money laundering practices at other exchanges, arguing that current screening mechanisms can be “easily bypassed.”
The company also claimed that Elliptic, a blockchain analytics firm, had previously refused eXch as a customer because they operated as a “non-KYC accountless exchange” focused on preserving user privacy. Roberts characterized this as reflecting “elitist policies of certain companies like Elliptic.”
Neither Bybit nor Elliptic immediately responded to Decrypt’s requests for comment on these allegations. The exchange will completely cease its current operations by May 1, with SIGINT (Signals Intelligence) monitoring reportedly a factor in the decision to shut down.
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