By Nermeen Nabil Khear Cryptocurrency exchange OKX announced today that it has temporarily halted its decentralized exchange (DEX) aggregator following a series of targeted media attacks and a detected attempt by the Lazarus Group to exploit its platform.
Following the $1.5 billion Bybit hack, OKX Web3 reportedly drew regulatory attention over concerns about its platform being used for money laundering.
In its March 17 statement, OKX revealed that the notorious North Korean hacking group had conducted a “coordinated effort” to misuse its DeFi services. This prompted the company to take “decisive action,” including the temporary suspension of its DEX aggregator services, after consulting with regulators.
Hacks Are Common
Based on the general tactics employed by Lazarus, this could involve using OKX’s platforms to launder stolen funds, since DeFi platforms often allow users to conduct transactions without strict Know Your Customer (KYC) requirements.
According to OKX, the suspension is intended to allow for the implementation of “additional upgrades” to prevent further misuse.
The company is also working with blockchain explorers to correct what it describes as “incomplete labeling,” where its aggregator was mistakenly identified as the point of trade, rather than the underlying DEX.
OKX noted that OKX Web3 operates as a DEX aggregator, facilitating trades across multiple decentralized exchanges, and does not hold custody of user funds.
“Our role is to provide access to liquidity across multiple protocols, offering users the most efficient peer-to-peer trading experience possible,” the firm clarified.
OKX has also launched a “hacker address detection system” for its DEX aggregator and a system to track and block hacker addresses across its centralized exchange (CEX) platform in real-time.
The OKX team alleges that some parties have deliberately misrepresented their Web3 platform, which they believe undermines both the company and the digital asset sector.
The firm has pledged to continue innovating and advocating for a “more transparent and responsible digital asset space,” promising further updates in the near future.
EU Regulators Probe OKX Web3’s Role
Following the landmark Bybit attack, OKX, alongside other crypto firms and figures, publicly voiced support for the exchange. Nevertheless, OKX has been under scrutiny for allegations that its Web3 services were used to launder stolen funds from the Bybit hack.
Bloomberg reported last week that European Union regulators were investigating OKX’s Web3 service amid concerns that hackers, then identified as Lazarus Group, used the platform to launder $100 million in stolen crypto assets from Bybit.
The investigation surfaced in the wake of a $1.5 billion hack targeting crypto exchange Bybit. The massive funds stolen have made it one of the largest crypto thefts in crypto history.
The Bloomberg report stated that regulators were examining whether OKX’s Web3 service, which the company markets as a DeFi platform and self-custodial wallet, falls under the EU’s new Markets in Crypto Assets (MiCA) regulations. Lazarus Group allegedly used the service to transfer stolen funds across various exchanges and blockchains.
Responding to Bloomberg’s reporting of the investigation, Haider Rafique, OKX’s Chief Marketing Officer, said in an X statement that the claims were misleading. The company maintains that its Web3 service operates similarly to other self-custody wallets and exchange aggregators in the industry.
Rafique also noted that OKX froze funds associated with the Bybit hack that entered its CEX and developed new security measures to detect and block malicious addresses. And according to him, the exchange cooperated with law enforcement and Bybit’s legal team to provide technical support to track hackers’ wallet addresses in real-time.
Bybit CEO Ben Zhou, who has acted actively to address the exchange hack and provide transparent updates, said that there was a misunderstanding regarding the source of information in a recent Bloomberg article.
He clarified that Bybit did not provide any direct statements to the publication, and that the information might have originated from Lazarus Bounty’s webpage, which tracks the movement of stolen funds in real-time.
The post OKX Temporarily Suspends DEX Aggregator to Counter Lazarus Group Misuse appeared first on Blockonomi.
This articles is written by : Nermeen Nabil Khear Abdelmalak
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