Cryptocurrency Mixing Service Blender.io Sanctioned by US Government
Cryptocurrency mixing service Blender.io has made history as the first of its kind to be hit with US government sanctions. The move comes after allegations that the service was used by North Korean hackers to launder over $20.5 million of the $620 million stolen from the Ronin Network in March.
US Treasury Takes Action
The US Treasury’s Office of Foreign Assets Control (OFAC) has taken action against Blender.io, stating that the firm aided the Democratic People’s Republic of Korea (DPRK) in laundering the stolen funds. Under Secretary of the Treasury for terrorism and financial intelligence, Brian Nelson, emphasized the threat posed by virtual currency mixers that assist illicit transactions to US national security interests.
Crypto Mixers and Criminal Activity
Crypto mixers like Blender.io pool virtual currency from multiple customers before redistributing it, claiming to enhance privacy for their users. However, these services also attract criminal elements looking to launder illicit funds.
Record-Breaking Theft
The theft from Ethereum sidechain Ronin Network, created by Vietnamese blockchain game developer Sky Mavis, is considered the largest on record. The US government alleges that the stolen funds are being used to finance North Korea’s nuclear weapons and ballistic missile programs.
Sanctions and SDN List Update
In addition to sanctions against Blender.io, the Treasury has updated its List of Specially Designated Nationals and Blocked Persons (SDN list) to include four new virtual currency addresses used by North Korea’s Lazarus Group to launder the remaining stolen funds from Ronin Network/Axie Infinity.
The original theft involved 173,600 Ethereum ($592 million) and $25.5 million in two transactions. Since Blender.io deals exclusively in Bitcoin, some of the stolen funds would have had to be converted before being processed by the service.