Blockchain sleuth ZachXBT has accused Backyard Finance, which manufacturers itself as “the quickest Bitcoin bridge,” of facilitating the laundering of funds linked to main crypto thefts, together with the Bybit hack.
In a June 21 submit on X, ZachXBT claimed that over 80% of Backyard’s current charge income stemmed from illicit transactions allegedly tied to the North Korean Lazarus Group.
The allegation got here in response to an earlier submit by Jaz Gulati, a co-founder of Backyard Finance, who had just lately touted the platform’s success, citing 38.86 Bitcoin (BTC) in collected charges — $300,000 of which was earned over the 12 days ending June 2.
“You conveniently overlooked >80% of your charges got here from Chinese language launderers transferring Lazarus Group funds from the Bybit hack,” ZachXBT mentioned.
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Laundering by way of centralized liquidity
ZachXBT additional alleged that {that a} single actor constantly topped up cbBTC liquidity from Coinbase, successfully fueling illicit flows whereas Backyard claimed to function a trustless and decentralized mannequin.
“Clarify how it’s ‘decentralized’ once I watched in actual time for a number of days as a single entity saved topping up cbBTC liquidity from Coinbase,” ZachXBT wrote, questioning the mission’s claims of decentralization.
In response, Backyard Finance founder Jaz Gulati denied the allegations, stating that 30 BTC in charges have been collected previous to the Bybit incident. He dismissed the criticism as misinformation, calling the “faux decentralized” label baseless.
Backyard Finance claims to allow crosschain swaps inside 30 seconds whereas providing zero-custody danger.
Based on its Dune Analytics dashboard, the mission has facilitated over 24,984 BTC in whole quantity, equal to greater than $1.5 billion, throughout 40,571 atomic swaps. The platform has collected 40.11 BTC in charges thus far, with its largest single swap reaching 10 BTC.
Cointelegraph reached out to Jaz for remark by way of X however had not acquired a response by publication.
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Crypto founder accused of laundering $530M
Final week, Iurii Gugnin, the founding father of crypto funds agency Evita Pay, was arrested in New York. He faces 22 federal prices tied to a sprawling cash laundering scheme allegedly involving over $530 million.
Based on the US Division of Justice, Gugnin facilitated stablecoin transactions that enabled shoppers linked to sanctioned Russian banks, corresponding to Sberbank and VTB, to bypass restrictions and achieve entry to delicate US applied sciences.
Prosecutors say the operation ran from June 2023 by January 2025. Gugnin is charged with wire fraud, cash laundering, and working an unlicensed cash transmission enterprise. If discovered responsible, he may face a life sentence.
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