Uniswap the Decentralised exchange has blocked 253 crypto addresses over the last four months that it worked with TRM Labs, which is a blockchain analytics firm. The reason behind the blocking was tied to connections with stolen funds.
This makes it the first ever time Uniswap disclosed data which is related to wallet blacklisting. These stolen funds were related to transaction mixing services that included Tornado Cash which was received as sanction from the US Treasury.
This data regarding embezzlements was furnished on GitHub by Uniswap software engineer Jordan Frankfurt. According to Yearn Finance developer Banteg had posted a tweet which comprised that Uniswap had blocked 253 crypto addresses.
It stated in one of the tweets, “Uniswap has provided an unusual level of transparency,” Banteg said in regard to “frontend censoring via TRM Labs”. Uniswap had recently struck a partnership with TRM Labs this year in the beginning and the organisation is responsible for blacklisting crypto addresses which are linked to sanctions and crypto related illegal activities.
There was ambiguity regarding how many crypto addresses were blacklisted by Uniswap in collaboration with the TRM Labs gated front end.
It was later mentioned that 253 addresses were blacklisted and 30 addresses are ENS (Ethereum Name Service) domain names. Banteg, the developers has also noted that there were a total of seven different types of risk factor categories and also two risk levels.
Banteg also stated that,
Both ownership and being a counterparty of a ‘bad’ address are checked and can contribute to blocking.
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Additionally there are three core thing which comprise Uniswap. The first one being the code that is running on the blockchain which anyone can interact with.
The other has to be a front-end website that provides one way users to interact with the code, thirdly a company that develops the protocol which runs the front-end website.
The company is based out of the US. Blocking the crypto addresses is going to happen on front-end level.
The comments on GitHub according to Frankfurt, the software engineer of Uniswap, it initially had blocked the addresses which were indirectly associated with the sanctioned addresses but was scaled back.
According to the graphic posted on GitHub. it mentioned the seven types of ill conduct which TRM Labs will look for while it verifies the addresses. Stolen funds from the transaction mixer, sanctioned addresses, extra funds from known fraud are the major four categories which are detected commonly.
Other remaining categories include money used to finance terrorism and funds from hackers, it also includes matters which concern child sexual assault.
Banteg mentioned that in order to simplify the process of delivering the crypto payments to these wallets, 30 of these addresses were linked to ENS (Ethereum Name Service) names.
Featured image from The Tycoon.io, Chart from TradingView.com
TRM Labs' research reveals Tron's dominance in illicit crypto transactions, accounting for 45% of scams in 2023. Ethereum and Bitcoin follow with 24% and 18%, respectively. Concerns persist over stablecoins' role, notably Tether, totaling $19.3B in illicit activity. Despite a 9% decrease in total illicit volumes, regulatory oversight remains crucial.
Huang BoNorth Korea-linked hackers stole over $600 million in crypto last year, raising concerns among U.S. national security officials. Despite a 30% decrease from the previous year, the funds continue to fuel weapons of mass destruction. The use of social engineering tactics remains prevalent, emphasizing the need for strengthened cybersecurity measures. The Ronin theft in 2022 shifted the national security conversation, prompting a whole-of-government approach to address the ongoing threat. The crypto community faces a persistent and evolving challenge with global implications.
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