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Senior security engineer Shakeeb Ahmed admitted on Thursday to exploiting the Nirvana Finance protocol and a decentralized cryptocurrency exchange in the Southern District of New York, USA, whose name has not been announced.
Ahmed admitted to losing $12.3 million stolen from two hacks. He also committed to paying a total of $5 million in compensation to the victims.
US lawyer Damian Williams stated in his announcement, “This is the first conviction for such a hacking case.”
Two Attacks in 2022
Ahmed was accused of electronic fraud and money laundering in July. According to the indictment and reports, he took advantage of a security flaw that matched a definition by Crema Finance in the smart contract of an unnamed Solana-based exchange.
Some time after the first hack, Ahmed implemented an attack worth $3.6 million, which included flash loans to Nirvana Finance and an exploitation he discovered in the platform’s smart contracts.
Nirvana Finance had offered Ahmed a $600,000 reward in exchange for the return of stolen funds, but Ahmed requested $1.4 million instead, and the parties never reached an agreement.
In his statement, Ahmed said, “He laundered the funds using complex technical methods like ‘token swapping’ and ‘bridge building’ transactions”. Fraud advances from the Solana blockchain to the Ethereum blockchain, transfers the fraud income to Monero, a particularly difficult cryptocurrency to track and anonymize, uses overseas cryptocurrency exchanges, and cryptocurrency mixers such as Samourai Whirlpool,” he concluded.
The hacker is reportedly facing up to five years in prison. The sentencing is set for March 13.
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