Illicit Finance
Counterproliferation, sanctions evasion, offshore fraud, and the money that moves through all three.
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Bybit: the largest theft in the asset class, and the signing interface behind it
On 21 February 2025 roughly $1.46 billion left one of Bybit’s Ethereum cold wallets in a single transaction carrying three valid signatures from the wallet’s own…
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FTX: what happens to your coins when the exchange holding them files Chapter 11
A customer who held one bitcoin at FTX ended up holding a claim valued at $16,871.63, the price the estate fixed as of the petition date.…
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Prime Trust: the custodian that could not open its own wallets
A regulated Nevada trust company lost access to a set of legacy wallets holding customer assets.
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Three Arrows Capital: what an offshore liquidation looks like when the founders will not say where they are
A British Virgin Islands court wound up the fund on 27 June 2022. The liquidators’ own US bankruptcy filing, four days later, recorded that they did…
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United States v. Chen Zhi: how 127,271 bitcoin became the largest forfeiture in US history
Prosecutors in Brooklyn say the coins are the proceeds of forced-labour scam compounds in Cambodia.
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Mirror Trading International: 29,421 bitcoin and a trading bot that never existed
A South African company took 29,421 bitcoin from at least 23,000 people in the United States and more around the world, on the promise that an…
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CFTC v. Ooki DAO: the judgment that decided a DAO can be sued as an unincorporated association
A federal judge in San Francisco held that a decentralised autonomous organisation could be sued in its own name as an unincorporated association made up of…
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Celsius: the ruling that turned 600,000 depositors into unsecured creditors
Judge Martin Glenn read the terms of use that Celsius customers had accepted and found that they had transferred ownership of their coins to the company.…
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QuadrigaCX: the dead-man’s-keys story is not what happened
The famous version is that a young CEO died in India and took the private keys to the customer funds with him.
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Tornado Cash: the sanctions arc from Blender.io to Van Loon to United States v. Storm
Treasury sanctioned a piece of software, a federal appeals court held that the software could not be owned and so could not be blocked, and Treasury…
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Atom Holdings: two retail investors wound up a crypto exchange group in the Cayman Islands
They had no contract with the company they petitioned against, and could not afford the undertaking the rules appeared to require. Justice Kawaley let them proceed…
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Ruscoe v Cryptopia: the judgment that decided crypto can be held on trust
A New Zealand judge held that the cryptocurrency on a failed exchange belonged to the account holders, not to the estate. Two years later a New…