Hacker Pumps Meme Coin to Launder Funds on Binance

While Binance is working hard to repair its already fragile reputation, a scammer has dealt a fresh blow with a money laundering trick. The scammer pumped and dumped a memecoin on the exchange to successfully move stolen funds.

Onchian analytics platform Lookonchain shared details of the event which took an unusual pattern. Apparently, a hacker had gained control of a Binance market maker’s account and succeeded in moving stolen funds by manipulating the price of BROCCOLI, one of the low liquidity meme tokens listed on the exchange. 

Although it was a criminal activity, a crypto trader who spotted the plan early managed to make a $1 million profit by taking advantage of the pump and dump. This is just one in a series of hacks and scams targeting crypto platforms and users recently.

Binance Blamed for Pump and Dump

Most hackers and crypto thieves would use a crypto mixing service like Tornado Cash to move their stolen funds, but not this one. After gaining access to the market maker’s account, the bad actor bought a large number of the BROCCOLI token on spot. This large purchase led to a sudden spike in the value of the token, which gave the other trader a massive long opportunity.

Knowing that he would pump the tokens, the hacker opened a long position on perpetual futures trading and transferred the resulting funds through what seemed like legitimate self-trading. As is usually the case, Binance is getting the blame for the pump and dump which some believe was as a result of manipulation from the platform.

Unfortunately, this is coming at a time when Binance is fighting to protect its reputation from allegations of money laundering. The exchange was blamed for the big crypto crash in October that has crippled the market till this day, and recently faced a new lawsuit alleging the aiding of funds transfer for terror organizations. 

Crypto Scams Gaining Grounds

Since the inception of cryptocurrencies, scams have become more common and recently more sophisticated. The approach taken by this hacker for example is quite unorthodox, but there are several others that are being deployed lately.

The most recent is the stealing of funds from Pi token holders using a legitimate feature of the wallet. A much older method known as address poisoning was also used recently to steal $50 million in USDC from a whale, which suggests neglect on the part of crypto holders. 

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