СhangeNOW halts $1.5M in fraudulent transactions claimed to be st…

ChangeNOW, a non-custodial crypto exchange, reported that its AML system flagged and halted suspicious ALGO token and USDC stablecoin transactions worth about $1.5 million in total.

According to ChangeNOW, its risk-prevention and anti-money laundering system detected $1.5 million in suspicious transactions on February 19 involving ALGO tokens and Algorand-based USDC stablecoins, thus preventing the funds from being laundered and lost forever until further investigations could be carried out. ChangeNOW also stated it will fully cooperate with law enforcement to ensure victims receive their funds back. 

The transactions were found to be connected with recent reported hacks of several members of the Algorand community, which resulted in the theft of over 13 million ALGO. It is still unclear whether the funds were hacked or if it was a typical crypto scam where users entered their seed phrase on a fraudulent website. 

Upon requesting more details from ChangeNOW, we learned that the exchange successfully stopped three transactions: 600,000 USDC, 829,000 USDC, both on the Algorand network, and 300,000 ALGO, a combined value of $1.5 million. 

Meanwhile, we have not yet received a response from Algorand regarding the incident, so it is still unclear how the users’ funds were lost.

This latest capture of suspicious transactions by ChangeNOW follows a successful track record of its efforts to combat illicit crypto activity. In 2021, the exchange recovered $15 million in COMP tokens that had been sent to users accidentally due to a system bug. It also returned $1 million in MATIC tokens stolen from Eterbase in 2020. 

In spite of the fact that ChangeNOW does not require KYC from its users, it still implements a set of undisclosed anti-fraud and anti-money laundering mechanisms, which have helped it recover over $19 million in user funds lost to fraud and hacking.