The two men, aged 18 and 20, allegedly stole $9.5 million in cryptocurrency from the American platform Platypus.
Source AFP
© Richard BRUNEL / MAXPPP / PHOTOPQR/THE MOUNTAIN/MAXPPP
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DTwo French people suspected of having hacked an American decentralized finance platform, Platypus, for damage estimated at 9.5 million dollars in cryptocurrency, were arrested on Wednesday in Île-de-France, the investigating police department announced on Saturday.
It was on a report from the Binance cryptocurrency exchange platform that investigators from the Central Office for Combating Crime Related to Information and Communication Technologies (OCLCTIC) were warned on Friday February 17 of a possible scam carried out from France targeting the American company Platypus.
The two men, brothers aged 18 and 20, were arrested on Wednesday February 22. The eldest is suspected of having carried out the scam and his brother of having benefited in part from the stolen money. At their home, 210,000 euros in cryptocurrency were seized.
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Instant cryptocurrency loans in the sights of justice
At the end of their police custody, they were presented to the prosecutor and will be summoned before the criminal court, said the Paris prosecutor’s office, without specifying the date. They were placed under judicial supervision, he added. One is prosecuted for fraudulent access and maintenance in an automated data processing system, fraud and money laundering, the second for concealment of fraud, said the prosecution.
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On February 16, hackers relied on “flash loans”, instant loans in cryptocurrency without collateral but repayable a few seconds later, detailed Christophe Durand, deputy head of the investigating office. They first took out a $44 million loan from a pool of cryptocurrency investors. Then, a second loan of 41 million dollars from Platypus, with the first loan as collateral.
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Then, they used the possibility of “emergency exit” from this loan to withdraw the equivalent of 8.5 million dollars, then about 1 million, explained the commissioner. In total, the damage to Platypus was assessed at $9.5 million in cryptocurrency. But, following an error on their part, the hackers only recovered the equivalent of 270,000 euros. They spent around 60,000 euros.
Serious consequences for Platypus
For the American company, the hackers’ operation had serious consequences, since once the hacking became known, its “USP” cryptocurrency collapsed by “half of its value”, explained Commissioner Durand.
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During his custody, the eldest of the two brothers tried to explain, according to the commissioner, that he was a pirate white hat (an ethical hacker who defends citizens and businesses) and that he had wanted to negotiate compensation with the American company for the discovery of a flaw in their verification system.
In the end, of the 9.5 million dollars stolen, 7 million are blocked in the virtual universe of cryptocurrencies and are “out of everyone’s reach” and 2.5 million were recovered by Platypus. Christophe Durand insisted on the speed with which the hackers had been identified and arrested, thanks to “the work of the engineers who assisted the investigators” to trace the movements of cryptocurrencies in the world of finance 2.0.
