Railgun blocks Inferno Drainer’s attempt to launder 174 ETH worth of stolen funds

The popular crypto privacy protocol Railgun has successfully thwarted Inferno Drainer’s latest effort to launder the stolen funds, which were sent back to the original wallet address.

According to a July 10 post by SlowMist’s anti-money laundering tracking system, MistTrack on X, Railgun intercepted an attempt to launder more than 174 ETH, worth about $533,000 at the time. This forced the perpetrators to return the stolen ETH to the original Inferno Drainer wallet.

Inferno Drainer is back

Inferno Drainer, a notorious multi-chain crypto drainer, has been operating under a scam-as-a-service mode. It tricked victims by using sophisticated phishing websites to trick them into connecting their crypto wallets to the attackers’ network.

The group announced the closure of its operations after siphoning more than $80 million from 5,000 victims through 689 fishing sites between November 2022 and November 2023. However, Inferno Drainer resumed its activities in in May, citing “an increase in demand” and the departure of competitors like Pink Drainer as the reason for its return to the illicit market.

Despite being inactive for nearly six months, the scam group claimed to have drained more than $125 million in crypto assets in what it described as “private operations.”

“We made this decision after other major competitors were shut down and because of people trying to resell the drainer, as we don’t want people getting scammed/scammed/losing hits due to other incompetent drainers.”

Railgun faces scrutiny

Tornado Cash has been widely used to launder stolen funds by scammers, including the wallet draining group Inferno Drainer. Following US government sanctions on the crypto mixer, experts have labeled Railgun as an alternative.

Popular crypto journalist Colin Wu had also claimed that the notorious North Korean hacker group Lazarus Group was using Railgun instead of Tornado Cash. Wu referred to an FBI statement from January 2023 that accused Railgun of being used to launder more than $60 million of ETH stolen during the 2022 Harmony Bridge heist.

Railgun, however, refuted allegations that North Korea and other US-sanctioned entities are using it to launder stolen digital assets. Describing the claims as “false reports”, Railgun stated that the Lazarus Group cannot gain access to its system, thanks to its “Private Proofs of Innocence” feature, which has been in operation since January 2023.

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