update 18 August 2021

CipherTrace Report on the Bank and Crypto Exchanges Fraud by Two Chinese Hackers

Recently, CipherTrace released a detailed analysis of how two Chinese nationals laundered stolen crypto through various banks and crypto exchanges. 

The two Chinese national hackers are Tian Yinyin and Li Jidong. The two hackers got charged with money laundering conspiracy and operating an unlicensed money transmitting business by the US Department of Justice.

The Technique Used to Carry out the Fraud as per CipherTrace

CipherTrace reported that the two Chinese hackers used a technique known as ‘peel chains’ to hide significant crypto deposits. The used peel chains to circumvent unwanted attention associated with a single, large transaction onto an exchange. 

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Additionally, the two phishers used peel chains to launder funds from two other exchanges successfully; hacks believed to be perpetrated by North Korean hackers. The report further revealed that the two hackers used fake identities and manipulated photos to pass the KYC procedures at various exchanges. The two hackers, however, got arrested and charged by the US government.