Two Russian men, Vladimir Avdeev and Sergey Yaschuck, have been charged with stealing nearly $6 million worth of XRP from the Philippines-based crypto exchange Coins.ph. The Department of Justice in the Philippines filed cybercrime-related charges against the men at the Taguig Regional Trial Court. According to investigators, Avdeev and Yaschuck, who were previously consultants at a platform managed by Betur, used insider knowledge to hack the trading platform’s networks and made off with over 12 million XRP coins in October last year. The men allegedly had a deep understanding of the platform’s network infrastructure and server systems.
The Department of Justice filed a total of 23 charges against Avdeev and three charges against Yaschuck. Investigators revealed that the hackers attempted to throw off investigators by trading the stolen coins for other tokens on various platforms such as OKX, WhiteBIT, SimpleSwap, and Fixed Float. WhiteBIT reported blocking a significant number of XRP transfers from Coins.ph at the exchange’s request, preventing the transfer of 445,000 “stolen XRP tokens.” The hackers also allegedly used the OrbitBridge cross-chain protocol to convert part of the stolen cryptocurrency into other assets.
Despite the hackers’ attempts to obscure their trail by transferring the stolen XRP coins to different platforms, investigators were able to trace their activities. Citizens primarily use Coins.ph for crypto-powered remittances, with XRP accounting for almost 11% of the total volume of coins traded on the exchange. The hackers also attempted to move the stolen coins onto non-custodial exchanges. On July 14, internet sleuths linked the $305 million hack of the Japanese trading platform DMM Bitcoin to the North Korea-based Lazarus Group, citing similarities in laundering techniques and off-chain indicators.
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The charges brought against the two Russian hackers by the Philippines’ Department of Justice shed light on the sophisticated cybercrime tactics used to steal millions of dollars worth of XRP. The case underscores the importance of robust cybersecurity measures for crypto exchanges to prevent such breaches in the future. The hackers’ utilization of insider knowledge to breach the platform’s networks serves as a cautionary tale for businesses to ensure strict procedures are in place to protect sensitive information.
As investigators continue to uncover the extent of the cybercrime, the focus now shifts to tracing and recovering the stolen assets. The involvement of multiple platforms in the laundering of the stolen XRP highlights the interconnected nature of the crypto ecosystem and the challenges law enforcement faces in tracking illicit activities across various exchanges. The collaboration between industry stakeholders, regulators, and law enforcement agencies will be crucial in addressing cybersecurity threats and safeguarding the integrity of the crypto market.
