The United States Department of Justice classify the case as one of the most sophisticated cybercrimes in recent memory, exploiting security flaws in cryptocurrency-based financial platforms.
By Bena Ilyas
Edited by Marco T. Lanz
Updated
2 mins read
A 21-year-old Canadian national, Andean Medjedovic, faces charges in a major DeFi cyber heist, accused of stealing nearly $65 million from decentralized finance platforms KyberSwap and Indexed Finance. A Brooklyn federal court prosecution outlines allegations of wire fraud, computer hacking, and attempted extortion.
Authorities classify the case as one of the most sophisticated cybercrimes in recent memory, exploiting security flaws in cryptocurrency-based financial platforms. John J. Durham, US Attorney for the Eastern District of New York, announced the charges alongside officials from the Justice Department’s Criminal Division, IRS Criminal Investigation, FBI, and Homeland Security Investigations.
Canadian National Charged With Stealing Approximately $65 Million in Cryptocurrency From Two DeFi Protocols https://t.co/9WDB5A4b5L (Announced with @IRSCI_NY @NewYorkFBI @HSINewYork and @TheJusticeDept)
— US Attorney EDNY (@EDNYnews) February 3, 2025
In November 2023, Medjedovic executed a strategic attack on KyberSwap, a DeFi protocol that enables liquidity pools across multiple public blockchains, including Ethereum and Arbitrum. He borrowed hundreds of millions in cryptocurrency to manipulate KyberSwap’s automated market-making system, creating artificial price movements that exploited a vulnerability in its algorithm.
Through a series of calculated trades, he siphoned approximately $48.8 million from 77 KyberSwap liquidity pools operating on six blockchains. He then allegedly pressured KyberSwap’s developers, investors, and decentralized autonomous organization (DAO), demanding platform control in exchange for returning nearly 50% of the stolen funds.
To erase his digital footprint, he employed crypto-laundering tactics, using “bridge” protocols to transfer assets between blockchains and cryptocurrency mixers to mask transaction sources. At one stage, he even paid an undercover law enforcement officer posing as a software developer $80,000 to bypass restrictions on a frozen $500,000 transaction.
Medjedovic previously engaged in cybercrime. In October 2021, he used similar tactics to exploit Indexed Finance, a DeFi protocol managing digital asset pools, according to court papers. Unlike traditional equities, Indexed Finance’s “index pools” contained baskets of digital tokens.
By manipulating the protocol’s re-indexing process, which adjusted liquidity pools when adding new tokens, he distorted price calculations and diverted $16.5 million from investors. Investigators revealed he borrowed crypto to inflate values artificially before seizing assets.
After the Indexed Finance exploit, Medjedovic allegedly collaborated with an associate to launder funds. He used fraudulent identities to open cryptocurrency exchange accounts and relied on mixers to obscure transaction histories. Authorities later found a document titled “moneyMovementSystem,” outlining his step-by-step method for laundering large sums.
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With over 3 years of crypto writing experience, Bena strives to make crypto, blockchain, Web3, and fintech accessible to all. Beyond cryptocurrencies, Bena also enjoys reading books in her spare time.
