One Parity Ethereum Hacker Was Cashing Out His Funds And Here’s How

One parity ethereum hacker who made an attack of the wallet in 2017, has started cashing out his funds and in today’s Ethereum news, we find out how.

Parity is an ETH infrastructure provider that was well-known in 2017 for its multi-signature wallet. Multisig is a technology that requires multiple key holders to sign off the transaction to verify them and prevents the stealing of one key that can lead to loss of funds. however, one parity version was bugged and allowed the attacker to drain 153,037 ETH from three multi-sig addresses as one Parity ethereum hacker did. The Parity team reported:

 “Today, we witnessed the second-largest hack, in terms of ETH stolen, in the history of the Ethereum network. As of 12:19 pm UTC,  had drained 153,037 ETH from three high-profile multi-signature contracts used to store funds from past token sales. The problem was initially reported by the Parity team, since the affected MultiSig wallet contract was part of the Parity software suite.”

In 2017, the Parity Multisig hacker used Changelly, Shapeshift, and Changer "instant" exchanges owned by real companies to launder money.

Today, they can swap Ether into Bitcoin through Ren and then cash out it through Wasabi, much more private and decentralized. https://t.co/Uy6eKqL2Us pic.twitter.com/kD5Z4iDBBl

— Igor Igamberdiev (@FrankResearcher) January 2, 2021

What happened was that there was a bug that allowed anyone to obtain ownership of the MultiSig and to move the funds once they gain control of it. 150,000 ETH was worth about $30 million at that time but it is worth about $115 million now. While many of the funds were cashed out in instant swap tools that allowed them to launder funds through other networks, these tools later became unavailable as more KYC Regulations were implemented.

This eventually led to a period where the attacker didn’t cash out his funds but now one Parity hacker decided to move the funds.  According to crypto research conducted by Igor Igamberdiev, what the group or individual as a hacker was doing is swapping their ETH into RenBitcoin via decentralized exchanges and then withdrawing these RenBTC to their own BTC address. From there, they can mix their funds by using mixer services and attempt to cash them out. That is much more decentralized and private than the Tornado cash solution which could find it quite hard to hide the origination of millions of dollars worth of ETH. One address cashed out a handful of RenBTC while the rest were inactive.

As recently reported, Another software developer named Liam Aharon also analyzed the attack and concluded that it was close to taking down the entire network. He also said that as the Ethereum network overcame this attack, it could be much more vulnerable to similar attacks in the upcoming year.