Anonymous hacker served with restraining order via NFT

Anonymous hacker served with restraining order via NFT

The law firms Holland and Knight and Bluestone used a nonfungible token to serve a defendant in a hacking case with a provisional restraining order, marking the first documented judicial process facilitated by an NFT.

The so-called "service token" or "service NFT" was served to an unknown defendant in a hacking case involving LCX, a cryptocurrency exchange located in Liechtenstein that was hacked for over $8 million in January. The assault corrupted the platform's hot wallets, resulting in the loss of Ether, USD Coin, and other cryptocurrencies.

On June 7, LCX claimed that around 60% of the stolen funds had been frozen, with investigations ongoing in Liechtenstein, Ireland, Spain, and the United States. Based on a judgment from the New York Supreme Court, Centre Consortium, a company created by USDC issuer Circle and crypto exchange Coinbase, has frozen around $1.3 million in USDC.

The funds were laundered using Tornado Cash, according to LCX, but were eventually tracked using "algorithmic forensic analysis." The organization was also able to identify wallets linked to the hacker as a result of the investigation.

In light of these findings, the law firms representing LCX, Holland and Knight, and Bluestone, served the unnamed defendant with a temporary restraining order produced on-chain via an NFT. According to LCX, this system "was allowed by the New York Supreme Court and is an example of how innovation can bring legitimacy and accountability to a market that some say is ungovernable."