Hacker Moves $42.5M in Bitcoin to Ethereum

The hacker behind the Coinbase data breach has mocked publicly blockchain sleuth ZachXBT while swapping $42.5 million in Bitcoin to Ethereum. The message “L bozo” was left on-chain, clearly mocking ZachXBT and other analysts tracking the movement. This unusual act of digital defiance unfolded just after Coinbase refused to meet a $20 million ransom demand. The incident shocked the crypto community and investors are fearing a bigger security breach however the industry is not bowing down to such incident and plans to fight back. 

Coinbase Refuses $20M Ransom Demand

Coinbase confirmed that the breach originated back in December when a support agent was bribed to hand over sensitive user data. Nearly 97,000 customer accounts were exposed, including government-issued IDs and email addresses. While no passwords or private keys were compromised, the attacker threatened to exploit the data for phishing or further manipulation.

Instead of yielding to pressure, Coinbase offered a $20 million bounty to find the hacker. Soon after, the attacker moved $42.5 million in BTC to ETH using Thorchain, and then sold 8,698 ETH for $22.1 million in DAI. The transfer was traced live by analysts, making more interesting.

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$42.5 Million in Bitcoin Swapped to Ethereum

The aftermath is expected to be costly. Coinbase estimates the total financial impact may reach $400 million. Internal reviews have led to the firing of involved employees, and new countermeasures have been rolled out to curb insider threats. Meanwhile, the U.S. Department of Justice has launched a formal investigation into the breach.

This incident underscores the growing risks of social engineering attacks in the crypto sector and highlights the urgent need for tighter operational security at major exchanges.

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