$680K in Crypto Mining Recovered: DOJ Returns Funds to Victims
The U.S. Department of Justice has recovered $680,000 in cryptocurrency mining-related funds and is in the process of returning funds stolen through a Safemoon smart contract vulnerability.
DOJ Recovers Funds Mined in Safemoon Attack
The U.S. Department of Justice (DOJ) announced on June 12 that it has seized and is in the process of returning more than $680,000 in stolen cryptocurrency to a cryptocurrency and blockchain company affected by a scheme involving smart contract manipulation. The case revolves around a vulnerability in Safemoon’s liquidity pool mechanism, which was exploited in March 2023 in an attempt to artificially inflate token prices.
The United States pursued civil asset forfeiture without criminal charges, recovering a significant portion of the diverted funds. The Justice Department asserted:
The United States has recovered and cleared ownership of more than $680,000 in stolen cryptocurrency using civil asset forfeiture and is in the process of returning that money to victims.
The theft revolved around a programming flaw in Safemoon’s smart contract that allowed for token burning, a practice that distorted market value, the Justice Department explained. A separate trading bot intercepted the action and redirected the profits to its own operator, who then contacted Safemoon and negotiated to keep 20% of the funds. The FBI then intervened.
The DOJ details:
On May 15, 2023, the FBI seized $680,467.92 and 480,996 BNB from accounts at OKX, a cryptocurrency exchange platform, accounting for about half of the 20% extorted from Safemoon.
“Safemoon has filed for bankruptcy, but the funds are being returned to the bankruptcy trustee for Safemoon,” the DOJ clarified.
Neither the original attacker nor the bot operator have been located or charged, leaving the use of civil proceedings to reclaim the assets. The forfeiture process allows any interested party to challenge the claim before a federal judge.