Operations at the privacy-centric crypto platform eXch are set to cease on May 1, following mounting accusations linking it to the laundering of digital assets connected to a major Bybit security breach.
In a mid-April announcement, the eXch team revealed the project was purportedly facing a “transatlantic operation” aimed at its closure and potential prosecution of key personnel over illicit finance concerns, including terrorism funding.
The Czech-based platform, notable for its streamlined customer verification process, maintained it originated as a privacy experiment without profit motives. The team firmly denied any intention to enable illegal activities, clarifying that eXch functions as a privacy-enhancing instant exchange, distinct from traditional coin mixers.
Intelligence allegedly sourced from state contacts indicated eXch’s inclusion in ongoing investigations concerning the movement of illicit crypto assets, particularly those tied to the Bybit incident.
Initially, the exchange refuted claims of processing funds from the Bybit hack, specifically denying assistance to North Korea’s Lazarus Group. However, eXch later conceded that a “small portion” of the stolen assets did pass through its system.
Blockchain intelligence companies, including Elliptic and TRM Labs, previously identified eXch as a significant node in the laundering pathway for funds from the Bybit exploit. Following the February 21 incident, which saw approximately 401,000 Ethereum (ETH) drained, the Lazarus Group reportedly employed decentralized exchanges, cross-chain bridges, and privacy tools like eXch to obscure the funds’ origins.
In its shutdown notice, eXch leveled criticism against centralized exchanges, citing ineffective policies that fail to curb money laundering significantly. Reasserting its commitment to user privacy, the team announced a 50 Bitcoin (BTC) fund dedicated to supporting open-source privacy initiatives within the Bitcoin and Ethereum ecosystems.
Despite closing its doors, eXch contended that its demise would not halt illicit financial activities within the crypto sphere. “The goal of stopping eXch under the belief that it may stop all money laundering in the world is ridiculous,” the statement declared.
The platform’s API will remain accessible to partners temporarily as a new management team oversees the final transition phase. The announcement concluded with the statement, “Privacy is not a crime.”