NEW YORK – The hack and the fraud victims who reached out to tornado cash demanding assistance in collecting stolen funds received little assistance from the developers of privacy tools, three government witnesses told ju judges on the second day of the Roma Storm’s criminal money laundering trial.
One victim, a Taiwan-born Georgia woman, said she lost almost $250,000 in a pig slaughter fraud where a portion of her proceeds have been washed through tornado cash — said her request for help was unanswered. Another witness, a lawyer for Crypto Exchange Bitmart, who was hacked for nearly $200 million in 2021, said Storm told his team there was nothing he or his fellow developers could do to recover the funds given the decentralized nature of the protocol.
The third witness Andy Ho — CTO and co-founder of Sky Mavis, the blockchain gaming company behind Axie Infinity and Ronin Network — detailed the 2022 stole over $625 million in a Ronin Bridge exploit. Although Ho himself did not mention it during his testimony, it was later revealed that the group behind the exploit was the Lazarus Group, a hacking organization sponsored by the North Korean state.
During the investigation of the three witnesses, prosecutors attempted to paint a portrait of the storm as someone who refused to raise their fingers to help hack the victim, or as someone who refused to make changes to the tornado cash protocol to discourage criminals from future use of the protocol.
Storm’s lawyers cast a different light on the lack of action from their client when they had the opportunity to oppose the “victim” witness. He hinted at them and couldn’t help regaining the funds because the tornado cash was decentralized. Storm told himself in an email on December 15, 2021, Will and Emery’s partner Joseph Evans, Bitmart’s lawyer, law firm McDermott, via email, according to an exhibition featured by the government.
Evans also admitted in cross-examination that Tornado Cash was not the only place Bitmart’s hacked funds went after the misuse. His company also reached out to 1inch, a warrant exchange aggregator. Evans said he has not received responses from the latter two companies.
Brian Klein, a partner at Waymaker LLP and attorney for Roman Storm, asked Evans if it was true that Roman Storm was the only person who responded directly to Evans’ enquiries after a Bitmart hack.
“That’s right,” Evans said.
Storm’s lawyer asked Ho, the CTO of Sky Mavis, that he was on a similar line of questions when he was in his position, but said Ho had been summoned to the government and asked him to travel to New York from his hometown of Ho Chi Minh City.
Another Waymaker partner and member of the Storm’s defense team, Keliaxel asked if he remembers the discoveries presented to Skymavis by Cloud Strike after the theft, including that the stolen funds were filtered through exchanges with many protocols other than tornado cash, including FTX, huobi and crypto.com.
“I don’t remember,” Ho said to each of them.
Axel asked how much of the stolen money could ultimately recover. Ho said $6 million was returned by Norwegian police.
“Did you understand that $6 million has passed through tornado cash?” Axel asked Ho.
“I don’t have that knowledge,” Ho said.
Read more: Legal privacy tool or dirty money coin indo-romat? Lawyers discuss the role of tornado cash on the first day of the Rome storm trial
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