Crypto Swapper eXch Shut Down After Bybit Hack, Yet Continues Stealth Operations—Security, Laundering, and Regulatory Risks Persist

Crypto swapper eXch, known for enabling anonymous crypto transactions via its no-KYC policy and pooled liquidity, was officially shut down by German authorities in April after being linked to the laundering of funds from the $1.4 billion Bybit hack, allegedly involving the notorious Lazarus Group. During the shutdown, servers and approximately €34 million in crypto assets were seized. However, blockchain security firms now report that eXch may still be servicing select clients through its back-end APIs, despite its public closure. This suggests the platform’s operations are continuing in stealth mode, leveraging its decentralized architecture and multi-jurisdictional structure to evade regulatory oversight. eXch has processed a total of $1.9 billion in cryptocurrencies since inception, becoming a preferred tool for hackers and illegal drainers such as Monkey Drainer, Pink Drainer, and Inferno Drainer. The case underscores continuing global challenges around regulating KYC-less crypto platforms, as criminal actors may migrate to other decentralized protocols like THORChain for money laundering. While the shutdown is a positive development for industry security, the persistence of such platforms exposes gaps in enforcement and highlights persistent tensions between privacy and compliance. Crypto traders should be alert to possible short-term volatility from regulatory actions, while long-term impacts hinge on regulatory adaptation and the evolution of laundering tactics.