Cryptocurrency mixing service Blender.io has been hit with a crackdown by the US Treasury Department.
The service, which allows users to add an extra layer of anonymity to their cryptocurrency transactions by “mixing” their tokens, will no longer be able to transact with US-based customers.
This is the first time a virtual currency mixer has been sanctioned according to Under Secretary of the Treasury for Terrorism and Financial Intelligence Brian Nelson.
Why the move?
The US Treasury says the move is the result of Blender.io’s assistance to cybercriminals, linked to North Korea, who stole nearly $620 million in the March attack on the Ethereum sidechain of the Axie Infinity game developer, Ronin Bridge.
The government department alleges that Blender.io was used to process $20.5 million worth of ill-gotten coins.
“Virtual currency mixers that aid criminals are a threat to the national security interests of the United States,” a Treasury Department spokesperson said. “Treasury will continue to investigate the use of mixers for illicit purposes and review the range of powers available to Treasury to respond to illicit funding risks in the virtual currency ecosystem.”
The Ronin attack was not the first time that Blender.io had been involved in illicit activities according to the department’s statement.
Blender.io’s service has helped launder approximately $500 million in Bitcoin since its launch in 2017, and has helped facilitate transactions with Russian-linked ransomware groups such as Trickbot, Conti, Ryuk, Sodinokibi and Gandcrab .
The Blender.io sanctions weren’t the only measure to crack down on cybercrime announced by the US Treasury.
Additionally, the department added four new cryptocurrency wallet addresses linked to the North Korean Lazarus Group, which was widely blamed for the devastating 2017 WannaCry ransomware attack on the NHS and sanctioned by the US government in 2019.
The move comes amid a broader crackdown on Russian-linked crypto crime.
A total of 25,000 Coinbase addresses linked to Russian individuals or entities have been blocked so far.
In a blog post, Coinbase Chief Legal Officer Paul Grewal said the accounts had engaged in “illicit activities,” and while the company is cooperating with the U.S. government on such matters, claims that these accounts have been identified through its own proactive service. surveys.