A crypto wallet controlled by the United States government has received $19.3 million in digital assets after a previous hack. On Oct 24, the wallet was reportedly drained of $20 million in assets and has now received the bulk of lost funds. Several crypto enthusiasts have flagged the transactions, stating that the hackers might be making a U-turn.
A Series of Mysteries Transfers
Blockchain analytics firm Arkham Intelligence wrote on X (formerly Twitter) that the US government-controlled wallet received $19.3 million of previously drained funds less than 24 hours after the initial incident. On-chain data shows that the returned funds consist of stablecoin USDC and Ethereum.
“The US Government’s address has just received $19.3M back following yesterday’s reported hack, less than 24 hours after the initial address breach. 88% of the compromised USD value has now been recovered.”
Subsequently, part of the assets began flowing to a new wallet. Later, total outflows hit $6.1 million, including an Aave version that accrues interest. More transfers in USDC followed as crypto enthusiasts flagged outflows. Most within the community say the transfers are akin to test flows, which take place before the main transactions. This played out in July when the German government used test transfers before marking huge sales.
The German government’s Bitcoin sale reduced sentiments in the market, bringing the price of the asset below $55k. The selling pressure led many retail investors out of the market, with bulls acquiring their positions. A cross-section of the community has likened present transfers to a larger outflow.
Hacker Stole $20 Million
On Oct 24, a hacker drained $20 million from the US-controlled wallet. Blockchain sleuth ZachXBT flagged the transactions that raised eyebrows. The funds seized by the U.S. government were part of assets drained from the infamous Bitfinex hack in 2016. About 120,000 BTC was lost as a result of the incident, and law enforcement made seizures afterward.
Arkham Intelligence wrote on the Oct 24 heist that the funds were being laundered after being moved to the new wallet. “The funds were moved to wallet 0x348 which has begun selling the funds to ETH. We believe the attacker has already begun laundering the proceeds through suspicious addresses linked to a money laundering service.”