Crypto Mixer Sinbad Faces U.S Sanctions Over Money Laundering

• Tornado Cash and Blender are cryptocurrency mixers that OFAC has formerly sanctioned.
• The OFAC said that Sinbad had handled cryptos valued at millions of dollars from thefts.

The cryptocurrency mixer Sinbad was sanctioned by the US Treasury Department’s Office of Foreign Assets Control (OFAC) on charges that it laundered funds for the North Korean hacker organization Lazarus.

The OFAC said on November 29 that Sinbad had handled cryptocurrencies valued at millions of dollars from thefts carried out by the Lazarus Group. These heists included the Horizon Bridge breach in June 2022, the Axie Infinity Ronin Bridge attack in March 2022, and the Atomic Wallet hack in June 2023. At the time, the cumulative loss due to the hacks was over $820 million.

Wally Adeyemo, deputy secretary of the Treasury stated:

“Mixing services that enable criminal actors, such as the Lazarus Group, to launder stolen assets will face serious consequences. The Treasury Department and its U.S. government partners stand ready to deploy all tools at their disposal to prevent virtual currency mixers, like Sinbad, from facilitating illicit activities.”

Possible Rebranding Effort

The U.S DOJ, FBI, Fiscal Information and Investigation Service, Public Prosecution Service, and National Bureau of Investigation of Finland have confiscated the Sinbad website as of November 29. The goal of the sanctions, according to the Treasury, is not punishment but rather a constructive shift in conduct.

Tornado Cash and Blender are cryptocurrency mixers that OFAC has formerly sanctioned; Treasury claimed that Blender also laundered cash for Lazarus. Elliptic, a risk management company, said in February that it was “highly likely” based on on-chain activity that Sinbad and Blender were the same entity, suggesting a possible rebranding effort to avoid sanctions.

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