Germany Seizes $38 Million in Cryptocurrency Linked to Bybit Hack
Date: May 9, 2025
German authorities have successfully seized 34 million euros (approximately $38 million) in cryptocurrency from eXch, a platform allegedly involved in laundering funds stolen during the notorious Bybit hack. This operation, announced by Germany’s Federal Criminal Police Office (BKA) alongside Frankfurt’s main prosecutor’s office, marks the third-largest cryptocurrency confiscation in the history of Germany’s federal criminal investigation efforts.
The Seizure Details
The seizure occurred as part of an investigation into eXch, which has been described as a “swapping” service for exchanging various cryptocurrencies. Authorities found that the platform did not implement adequate Anti-Money Laundering (AML) measures, facilitating approximately $1.9 billion in transactions since its inception in 2014. The law enforcement action was not solely limited to the cryptocurrencies; authorities also confiscated the server infrastructure of eXch, which contained over eight terabytes of data, effectively shutting down the platform.
In the announcement, the BKA noted that a portion of the assets seized is linked directly to the $1.5 billion stolen from Bybit, which suffered a high-profile hack on February 21, 2025. This development raises significant concerns about the use of platforms like eXch in facilitating the laundering of illicit funds within the cryptocurrency ecosystem.
Profiling eXch and Its Operations
eXch operated as a peer-to-peer exchange platform, allowing users to swap cryptocurrencies without rigorous identity verification processes usually mandated under AML regulations. As a result, it became a tool for various criminal activities, including the laundering of stolen assets.
Several investigations have implied that eXch was involved in laundering funds not only from the Bybit hack but also from other major breaches, including the Multisig and FixedFloat incidents. According to insights shared by blockchain investigator ZachXBT, the platform has been linked to laundering operations involving millions of dollars lifted from various exploits over the years.
Statements from Authorities
Commenting on the operation, senior public prosecutor Benjamin Krause highlighted the need for stringent actions against platforms that offer rapid and anonymous money laundering capabilities. “Crypto swapping is an essential component of the underground economy, used to conceal incriminated funds from illegal activities such as hacking or trading in stolen payment card data, thus making them available to perpetrators,” he stated.
Despite initial denials of allegations connecting eXch to the Bybit hack, the platform announced its decision to cease operations effective May 1, stating that it could no longer operate in a ‘hostile environment’ where it was under constant scrutiny.
Implications for the Cryptocurrency Sector
This seizure underlines ongoing efforts by law enforcement agencies worldwide to combat the rising trend of cybercrime facilitated by cryptocurrencies. As regulatory scrutiny intensifies, platforms that lack adequate compliance measures face the risk of similar crackdowns.
As global attention continues to focus on the security and legitimacy of cryptocurrency exchanges, stakeholders within the blockchain ecosystem might find themselves under increased pressure to adopt stronger AML practices and safeguard against potential misuse of their services.
The BKA’s decisive action underscores the critical role of law enforcement in addressing vulnerabilities within the rapidly evolving landscape of digital currencies, strengthening the call for a more regulated cryptocurrency sector to combat illicit activities effectively.
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