THORchain-powered decentralized exchange (DEX) THORswap paused its usage after the persistent “movement of illicit funds” illicit funds through the platform.
In an Oct. 6 statementon X (formerly Twitter), the protocol decided to “temporarily transition the THORSwap interface into maintenance mode” after extensive “consultation with advisors, legal counsel, and law enforcement.”
THORSwap said the move was made to “swiftly curtail any further potential illicit activity” and expressed strong opposition to using its platform for any criminal activities. It added:
“THORSwap will remain in this mode until a more permanent and robust solution can be implemented to ensure the platform’s continued security and integrity.”
Over 50% of funds moved through THORSwap are stolen
Cryptocurrency researcher Tayvano reportedthat more than 50% of the Ethereum moved through the THORSwap router during the last four months were stolen funds.
The researcher estimated that 34,583 ETH, approximately $57 million, of “clearly stolen funds, were swapped into Bitcoin via THORSwap. They also added that at least another 3,300 ETH has been laundered through the platform.
Due to this development, THORSwap’s users will be unableto use the platform’s Swaps feature. However, they can still borrow and stake their asset via the protocol.
THORChain unaffected
Meanwhile, THORChain saidTHORSwap’s decision does not affect its operations, as its network remains fully operational and capable of supporting a variety of interfaces.
“THORChain, the network, is fully operational and can handle many different interfaces built on top of it. Interfaces include, Shapeshift, Rango, Trust Wallet, Ledger, XDefi, Asgardex, Edge wallet and more.”
THORChain said THORSwap only “caters to users, presents data, and quotes their swap requests,” adding that users are still tasked with building a swap and submitting the transaction directly to ETH/BTC nodes.
It added:
“The transaction is confirmed on respective L1 networks, and THORChain nodes react to these tx’s in an atomic and immutable way. No THORChain node can unilaterally affect a transaction; 16/20 work together to sign transactions. If a group fail to do a transaction, they are slashed and the swap is re-delegated to a different vault. This ensures tx execution guarantees.”
Posted In: DeFi, Technology
Author
Oluwapelumi Adejumo
Journalist at CryptoSlate
Oluwapelumi values Bitcoin's potential. He imparts insights on a range of topics like DeFi, hacks, mining and culture, underlining transformative power.
Editor
Liam 'Akiba' Wright
Senior Editor at CryptoSlate
Also known as "Akiba," Liam is a reporter, editor and podcast producer at CryptoSlate. He believes that decentralized technology has the potential to make widespread positive change.
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