Shady crypto mixing protocol eXch is merging with an offshore entity and restructuring to evade scrutiny over laundering tens of millions stolen from Bybit.
Centralized crypto mixing protocol eXch revealed in an update on Bitcoin Talk that it plans to relocate its operations and leave its current structure in Belize as regulatory scrutiny looms over its refusal to stop North Korea-affiliated hackers from laundering millions stolen from the Bybit crypto exchange.
The service announced that it would have “new shareholders and new members on the management board,” adding that this move would help “reduce risks for our founding team” while ensuring it can continue to operate without “giving up our values,” without defying what those values are.
EXch added that it’s “aware that there is an ongoing operation” targeting its service by “some law enforcement agencies” with the goal of adding the protocol to the OFAC sanctions list and seizing the protocol’s infrastructure.
“Since it’s primarily coming from U.S.-based agencies, we will update our ToS to inform our users in the U.S. not to use our service and warn them about the risks of being prosecuted in their country for using a service like ours.”
eXch
In its attempts to go off the radar, eXch said it’s also planning to delist by July-August the two largest stablecoins by market capitalization: Tether (USDT) and USD Coin (USDC) due to the risk of being blacklisted. Instead, the disgraced protocol will rely on DAI (DAI), an algorithmic stablecoin issued by MakerDAO, an Ethereum-based protocol.
The mixing service said it will also now only support dynamic addresses to avoid complications. It’s also changing its Bitcoin aggregation address to make it harder to link transactions to eXch.
eXch is under fire for refusing to work with blockchain sleuths trying to help Bybit stop North Korean hackers from laundering nearly $1.5 billion stolen in February. According to Bybit’s data, eXch laundered over $94 million in stolen funds and ignored requests to cut off the bad actors.
