BitForex's Exit Scam Leads to $56.5 Million in Financial Losses.

BitForex's Exit Scam Leads to $56.5 Million in Financial Losses.

Summary #

Since February 23, 2024, BitForex, a crypto exchange operational since 2017, ceased processing withdrawals amidst unexplained outflows of about $56.5M worth of crypto from its hot wallets. The absence of communication from BitForex, coupled with the recent departure of its CEO Jason Luo, has raised concerns over a potential inside job or exit scam.

Attackers #

The identity of the scammers is unknown, but the main suspect is the CEO of the exchange, Jason Luo. The nature of the outflows and a significant delay in response from BitForex, suggests this may not be a straightforward hack. Initial transactions, such as the test transaction of 0.01 $ETH, followed by 58-hour inactivity, indicate a controlled extraction of funds rather than a grab-and-run attack.

The following addresses are associated with the scam:

Losses #

The total loss from the BitForex scam amounted to approximately $56.5 million, distributed across the following networks:

  • Ethereum:

    • 471,414 TRB (54,200,000 USD)
    • 148 ETH (444,000 USD)
    • 258,700 USDC
    • 40,771 USDT
  • Tron

    • 657,698 USDT
    • 44,000 TRX (6072 USD)
  • Bitcoin

    • 5.7 BTC (290,000 USD)

Timeline #

  • January 31, 2024, 02:07 PM UTC: Exchange CEO Jason Luo steps down.
  • February 21, 2024, 08:16 AM UTC: The first malicious transaction occurred.
  • February 23, 2024: The exchange website was closed.
  • February 26, 2024: 0xScope published an analysis of the incident.
  • March 4, 2024: Hong Kong’s regulator for securities and futures markets has warned the public about BitForex for suspected fraud.