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ZachXBT accused the KuCoin exchange of facilitating the laundering of $9.5 million., 2026/04/14 16:57:23
Blockchain investigator ZachXBT has accused the cryptocurrency exchange KuCoin of inadequate anti-money laundering controls. According to the crypto detective, over $9.5 million, stolen through a counterfeit Ledger Live application, may have been laundered via the platform.
The stolen funds were swiftly funneled through more than 150 deposit addresses on KuCoin, which are linked to a centralized mixer called AudiA6—a service that obscures the traces of illicit cryptocurrency transactions, ZachXBT reported.
The anonymous crypto investigator pointed out a second similar incident: a few days prior, attackers transferred approximately 50 BTC ($3.5 million) from 25 deposit addresses on KuCoin. The analyst discovered that these bitcoins were stolen due to a hack of Bitcoin Depot ATMs.
The issue, as clarified by ZachXBT, is that the exchange allows instant swaps, has loopholes in its Know Your Customer (KYC) procedures, and effectively offers services akin to centralized mixers. The researcher believes this provides criminals with a rapid method to withdraw funds.
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ZachXBT estimated that the number of victims of the phishing scheme involving the fake Ledger Live application, which masqueraded as the official service from the wallet manufacturer Ledger, exceeds 50 individuals. All these users downloaded the fraudulent app from the App Store. They entered their seed phrases, after which the attackers gained complete control over their assets and quickly withdrew the funds.
The theft affected several blockchains, including Bitcoin, Tron, Solana, and Ripple. One victim lost 3.23 million USDT on April 9, another lost 2.079 million USDC on April 11, and yet another user had 20.64 BTC, 211 stETH, and 70 ETH worth $1.95 million stolen on April 8.
Apple removed the fake Ledger application from its store only on April 13.
Early last year, KuCoin admitted to engaging in unlicensed money transmission activities and agreed to pay nearly $300 million in fines. At that time, the exchange’s founders stepped down, and the platform committed to exiting the U.S. market. In March, the Southern District Court of New York imposed a $500,000 administrative fine on KuCoin’s operator, Peken Global, for failing to register with the U.S. Commodity Futures Trading Commission (CFTC).
