THORChain Sees Record $4.6B Volume After Bybit's $1.4B Hack

In the aftermath of a devastating $1.4 billion hack on cryptocurrency exchange Bybit, THORChain, a decentralized protocol enabling users to swap cryptocurrencies across various blockchains, has experienced an unprecedented surge in activity. According to data source DefiLlama, THORChain processed a record-breaking $4.66 billion in swaps during the week ended March 2, surpassing its previous highs.

The sudden influx of activity on THORChain follows a malicious hack of Bybit on February 22, which saw a North Korean entity walk away with an astonishing amount of ether. Observers believe that the hackers used THORChain to swap and launder funds, resulting in a significant spike in platform activity.

The Role of THORChain in the Hack

Blockchain analytics firm Nansen reported that the hackers sent funds from the initial Bybit Exploiter wallet through a complex network of wallets, with each "hop" further away from the main wallet resulting in smaller value transfers and an increased number of intermediary wallets.

"Starting from the initial Bybit Exploiter wallet, funds were sent across a further stretching net of wallets," Nansen said. "With each 'hop' further from the main wallet, there was an increasing amount of intermediary wallets and the value transfers became smaller and smaller." The firm identified THORChain as one of the entities used by the hackers to facilitate money laundering.

According to onchain analyst EmberCN, the entire $1.39 billion balance of stolen ETH was laundered in just 10 days, generating a record revenue for THORChain. The platform earned an estimated $5.9 billion in transaction volume and $5.5 million in handling fees due to the hackers' money laundering activities.

The Impact on THORChain

While the hack has undoubtedly had a negative impact on the cryptocurrency market, it appears that THORChain has benefited from the increased activity. The platform's record-breaking volume and revenue have provided an unexpected windfall for THORChain, raising questions about the potential risks of facilitating illicit activities.

"Hackers have laundered all 499,000 ETH ($1.39 billion) stolen from Bybit, a process that took 10 days," EmberCN said on X. The ETH price has fallen by 23% in the process (from $2,780 to $2,130 today). THORChain's main channel used for money laundering earned an estimated $5.9 billion in transaction volume and $5.5 million in handling fees.

A Cautionary Tale

While the record-breaking activity on THORChain may seem like a welcome windfall, it also serves as a reminder of the potential risks associated with facilitating illicit activities. As the cryptocurrency market continues to evolve, it is essential for platforms and exchanges to prioritize security and compliance measures to prevent similar incidents in the future.