THORSwap DEX enters maintenance mode amid illicit activity

THORChain-based decentralized exchange THORSwap announced it is “temporarily transitioning” into maintenance mode amid a rise of potentially illicit funds moving through the platform.

“A pressing and persistent concern has recently come to light: the potential movement of illicit funds through THORChain and, specifically, THORSwap,” THORSwap posted on X (formerly Twitter). “Such activities have no place on the THORSwap platform, and THORSwap stands firmly against any and all criminal actions.”

The move follows consultation with legal experts, advisors and law enforcement agencies, and the platform will remain in maintenance mode until “a more permanent and robust solution can be implemented to ensure the platform’s continued security and integrity,” THORSwap stated.

FTX hacker fund movements

The individual or entity behind suspicious withdrawals from the collapsed crypto exchange FTX — commonly called the “FTX hacker” —  transferred 22,500 ETH ($38 million) this week, according to on-chain analysts Lookonchain. 

The transfers involved swapping ether for bitcoin through THORChain and Railgun. The FTX hacker holds over 163,000 ETH ($275 million) in ether across several wallets.

Taylor Monahan, a product manager a Consensys, claimed on Monday that hackers and money launderers in Russia and North Korea use THORChain for their operations, adding that “in the last four months, more than 50% of the ether to THORSwap router to bitcoin transactions have been stolen funds.”

Transaction volume on THORChain has increased significantly this month, hitting a record $354 million on Oct. 5, according to THORChain Explorer.

Swap history volume. Image: THORChain Explorer.

Swap history volume. Image: THORChain Explorer.

The THORSwap team said it had no additional details to share at this time but assured its community they were doing everything possible to resume operations swiftly and further updates would follow.

© 2023 The Block. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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