- OKX paused its DEX aggregator to improve security and prevent misuse by hackers and competitors.
- Regulators are investigating OKX’s Web3 platform for possible violations of crypto regulations in the EU.
- OKX denied accusations of laundering funds linked to the Bybit hack and claimed it blocked suspicious transactions.
Crypto exchange OKX has temporarily suspended its decentralized exchange (DEX) aggregator. The company has cited security concerns and recent attacks targeting its platform. OKX announced the decision on Sunday, highlighting the need to strengthen its security framework.
The company identified incomplete blockchain tagging as a vulnerability. It plans to introduce additional security measures to prevent misuse. Blockchain tagging helps track and label transactions accurately, ensuring transparency on blockchain explorers.
Lazarus Group Allegedly Targeting OKX
The company reported detecting a coordinated effort by the North Korean hacking group Lazarus. The group has a history of conducting large cybercrimes. At the same time, OKX noted an increase in competitive attacks attempting to undermine its operations.
The new development emerged after reports surfaced about OKX’s involvement with laundering stolen funds from the Bybit breach. Bybit experienced a security breach in January. The hackers made away with $1.5 billion worth of both Ethereum tokens and ETH-related cryptocurrency assets. This incident became the largest crypto hack to date.
Bybit’s CEO recently revealed that nearly $100 million from the hack moved through OKX’s Web3 platform. A significant portion of the funds remains untraceable.
European Regulators Investigate Compliance
Regulators in the European Union are examining OKX’s decentralized finance services. Reports suggest that authorities are assessing whether its Web3 platform aligns with the Markets in Crypto-Assets regulations.
Concerns have emerged over potential illegal activities linked to the platform. EU regulators are discussing possible penalties. OKX denied being under investigation and called the reports misleading. The company urged users to recognize attempts to mischaracterize its role in the crypto ecosystem.
Company Implements Security Measures
OKX’s leadership dismissed the accusations. The company emphasized that they have put efforts to freeze funds, block hacker addresses, and prevent misuse of its services. It also confirmed consulting with regulators before pausing its DEX aggregator.
This situation adds to OKX’s legal challenges. Last month, its affiliate, Aux Cayes FinTech Co. Ltd, settled with the U.S. Department of Justice. The company agreed to pay over $500 million in penalties. Authorities accused it of operating without a money transmitter license and violating anti-money laundering laws.
