International authorities have taken action against the cryptocurrency platform ChipMixer, accusing it of aiding in the concealment of the digital money trail for online drug dealers, Russian military hackers, and North Korean cybercriminals.
On Wednesday, Europe’s Europol police agency and the US Department of Justice made the announcement, stating that the site had laundered over $3 billion worth of cryptocurrency. ChipMixer’s website was found to be offline and was replaced with a banner indicating that the website had been seized, displaying logos from German, American, Swiss, and Polish law enforcement organizations.
The Justice Department has charged Vietnamese national Minh Quoc Nguyen, 49, with money laundering and identity theft, linked to the platform’s operation. In its indictment, the department claimed that Nguyen openly flouted financial regulations and at one point told users of a Bitcoin forum that “‘Money laundering’ is a crime made-up by governments that spy on their citizens.”
According to FBI, Minh Quoc Nguyen has basic training in cryptographic engineering and previously worked in decrypting communications and cyber reconnaissance. In 2016, he earned a PhD in electronic engineering in Taiwan.
Minh Quoc Nguyen is wanted for his alleged direct involvement in stealing identities and engaging in money laundering activity in furtherance of obfuscating and facilitating the functionality of the ChipMixer service. Through this conduct, Nguyễn has allegedly facilitated the laundering of approximately $3 billion USD worth of Bitcoin. A large portion of the funds are directly associated with the victimization of people worldwide through ransomware attacks, cryptocurrency heists, the purchase of illicit drugs, the distribution and production of child sexual abuse material, and other crimes.
On March 14, 2023, Minh Quoc Nguyen was charged with Money Laundering, Operating an Unlicensed Money Transmitting Business, and Identity Theft in the United States District Court for the Eastern District of Pennsylvania, Philadelphia, Pennsylvania, and a federal warrant was issued for his arrest.
ChipMixer, an unlicensed cryptocurrency mixer that was established in mid-2017, specialized in mixing or cutting trails related to virtual currency assets. Europol described it as “one of the darkweb’s largest cryptocurrency laundromats,” and said that more than 40 million euros ($42.2 million) worth of cryptocurrency had been seized.
Digital currency tracking service Elliptic reported that ChipMixer had been used to launder over $844 million in Bitcoin that it tied directly to illicit activity, including at least $666 million from cryptocurrency thefts. Elliptic also revealed that ChipMixer was one of several mixers used to launder proceeds of hacks perpetrated by the Lazarus Group, a hacking gang that cybersecurity specialists and Western countries allege to be operated out of North Korea.
The Justice Department also alleged that Russia’s military intelligence service, the GRU, had used ChipMixer to purchase infrastructure for hacking operations. Cybercriminals often use mixers to obscure the trail of ill-gotten digital currencies, as blockchain transactions are publicly visible, and services such as ChipMixer have been subject to law enforcement seizures in the past. For instance, in May 2019, Europol announced the seizure of Bestmixer.io, a similar site.