Ex-Paxful CEO’s Bitcoin Marketplace Noones Exploited for Nearly $8M, ZachXBT Says

The peer-to-peer Bitcoin marketplace Noones, launched by former Paxful CEO Ray Youssef, has reportedly been exploited for approximately $7.9 million in stolen funds, according to blockchain investigator ZachXBT. The funds were allegedly siphoned off from Noones’ hot wallets on multiple blockchains, including Ethereum, TRON, Solana, and BNB Chain, and subsequently routed through Tornado Cash, a cryptocurrency mixer known for obscuring the origin of funds.

The Hack and Its Timing

The hack occurred in early January 2024, with suspicious outflows being traced back to the platform’s wallets. ZachXBT shared details in a Telegram post on January 24, revealing that the stolen funds were withdrawn in small transactions, each under $7,000. The stolen funds were first bridged between Ethereum and BNB Chain, and then funneled through Tornado Cash, a tool commonly used to obscure the trail of illicitly gained funds.

The timing of the hack raised further questions, as Noones had announced maintenance around the same time, but Noones has yet to issue any public statements acknowledging the breach. As of now, there has been no official response or explanation from the platform regarding the security incident.

Noones’ Background

Noones was launched in 2023 by Ray Youssef, who co-founded Paxful, one of the largest peer-to-peer cryptocurrency trading platforms. Youssef envisioned Noones as a more community-driven alternative to Paxful, offering users easier access to cryptocurrencies and digital payments while aiming to overcome some of the challenges he experienced at Paxful.

The hack comes as a significant blow to the platform, which is still in its early stages, and raises questions about the security practices employed by Noones, particularly with the absence of any official response. With over $7 million worth of funds compromised, the incident highlights the risks faced by peer-to-peer marketplaces, particularly in the absence of robust security measures.

The Noones hack, with stolen funds routed through Tornado Cash, underlines the ongoing challenges and risks within the cryptocurrency space, especially for peer-to-peer platforms. As the investigation continues and Noones remains silent on the issue, users and investors will likely be paying close attention to how the platform handles the aftermath and whether the stolen funds are recovered.