Atomic Wallet in Legal Turmoil Over 100M Worth of Cryptocurrencies Stolen

Lawsuit Over Unreported Hack

A recent class-action lawsuit has been initiated against Atomic Wallet, a noncustodial cryptocurrency wallet, over an alarming security breach that led to the loss of $100 million. This colossal loss took place in June, impacting more than 5,500 cryptocurrency accounts on its platform.

The legal battle against Atomic Wallet primarily stems from the company’s perceived negligence. Plaintiffs contend that the firm failed to inform their clientele about the breach or even notify law enforcement agencies.

Who’s Behind the Class-Action Suit?

The class action sees involvement from numerous high-profile investors, predominantly from Russia and the Commonwealth of Independent States. This news was brought to light by the German business media agency, BNE IntelliNews, on August 21st.

Two key figures orchestrating the lawsuit are Max Gutbrod, a seasoned German lawyer and formerly a partner at Baker & McKenzie in Moscow for over twenty years, and Boris Feldman, who co-founded the Moscow-based legaltech company, Destra Legal.

In a recent statement, Gutbrod disclosed:

“Our legal team is actively working to recuperate the assets for the affected clients. A class action against Atomic Wallet is in the pipeline due to their lack of transparency post-hack.”

Gutbrod also revealed that the duo represents around 50 clients, who collectively suffered a loss amounting to $12 million because of the security breach.

Tracing the Culprits: Lazarus or Someone Else?

Initial investigations, spearheaded by crypto analytics companies like Elliptic, have linked the nefarious hack to the notorious Lazarus Group from North Korea. This cybercrime syndicate has an infamous track record, having allegedly pilfered billions in crypto through a myriad of thefts.

However, Feldman’s assertions are now casting doubts on the aforementioned claims. In collaboration with blockchain analytics from Match Systems, Destra Legal suggests that a Ukrainian hacker group might be the real perpetrators.

“There’s evidence hinting at the involvement of Ukrainian cybercriminal factions,” Feldman was quoted saying.

Opaque Responses from Atomic Wallet

Post the cyberattack, Atomic Wallet remained relatively tight-lipped. The company only speculated on the probable causes, listing potential triggers like malware code injection, viruses on user devices, a man-in-the-middle attack, or an infrastructure breach. Despite the large-scale implications of the hack, Atomic Wallet maintains that the damage was minimal, affecting less than 0.1% of its user base.

Interestingly, Atomic Wallet resumed its operations almost immediately after the breach, raising eyebrows in the crypto community.