Three individuals have been arrested by Chinese police across several states in connection with a crypto heist worth around $87 million.
According to China Media Group the cryptocurrency hack was the biggest recorded case of its kind in China. Police told the SCMP that “Our bureau has not dealt with this kind of case before. It’s the first virtual currency-related case in Shaanxi.” The Hong Kong Standard reported that police arrested the primary suspect last week in the northwestern province.
The investigation has been running since March and was initiated when a Xian resident notified local police that his computer had been hacked. The victim claimed that the anonymous attackers had taken 100 million yuan (almost $15 million) in Bitcoin and Ethereum.
Working with a number of internet companies, the police located one of the suspects who they claimed had made a remote attack to transfer the funds from the victim’s computer. Two further accomplices where also identified leading to the arrests.
Investigators believe that the hackers had been employed by large tech companies and had in depth knowledge of the systems they targeted. The used a series of proxy servers in multiple countries to cover their tracks. Stolen funds were sold and split, spread over a number of wallets in smaller amounts via multiple transactions in an attempt to mask their actions.
The police had more than 30,000 separate streams of evidence to investigate according to China Media Group. The trio has also been accused of having conducted a series of cybercrimes into corporate and personal networks to pilfer crypto assets initially estimated to amount to around 600 million yuan (US$87 million).
The three suspects of what the police described as a sophisticated hacker group were arrested thousands of kilometers apart in Beijing, Changchun in northeast Jilin province, and in central Hunan province.
Chinese authorities have been quick to react to crypto-crimes following the country’s almost yearlong ban on crypto trading. The restrictive regulations have not suppressed the interest and demand for digital currencies among China’s burgeoning population. Much of the trading in China has now gone peer-to-peer or underground which leads to a less secure environment, more hacks and higher instances of crypto-jacking.
China could do more to eliminate these problems by adopting a more crypto-friendly stance and rolling out a regulatory framework as in Japan and South Korea. However the likelihood of that happening in the authoritarian nation is very slim at the moment.