U.S. Recovers $2.3M in Bitcoin From Colonial Pipeline Hackers

The cryptocurrency was used to pay the ransom in the attack on the Colonial Pipeline system.

A U.S. government task force has reportedly seized more than $2.3 million, out of the $4.3 million, in Bitcoin, which was used to pay the ransom in an attack on the Colonial Pipeline system.

Officials from the Department of Justice said in a press conference on Monday that they had found and recaptured millions of dollars worth of Bitcoin associated with DarkSide — a Russia-based hacker group.

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“The sophisticated use of technology to hold businesses and even whole cities hostage for profit is decidedly a twenty-first-century challenge,” said Deputy Attorney General Lisa Monaco, adding that “the old adage ‘follow the money’ still applies, and that’s exactly what we do.”

According to a warrant filed with the U.S. District Court for the Northern District of California, officials were able to obtain 63.7 Bitcoin worth around $2.3 million at the time.

Why It Matters: An FBI agent reportedly traced the flow of funds using an online blockchain explorer beginning on May 8, which was the day the ransom was sent, until May 27 when the funds were transferred to a “subject address.”

“The private key for the subject address is in the possession of the FBI in the Northern District of California,” read the warrant.

Reports began to emerge that the FBI came to obtain the private keys of the address in question after going through crypto exchange Coinbase Global servers.

However, these claims were later invalidated by Coinbase’s chief security officer Philip Martin, who stated on Twitter, “Coinbase was not the target of the warrant and did not receive the ransom or any part of the ransom at any point. We also have no evidence that the funds went through a Coinbase account/wallet.”

This story originally appeared on Benzinga. © 2021

Benzinga does not provide investment advice. All rights reserved.

Drew Angerer via Getty Images