Funds laundered through Tron bridges and OTC venues linked to illicit networks, highlighting ongoing crypto security flaws
A U.S. crypto investor has reportedly lost over $3 million worth of XRP after their Ellipal wallet was compromised in a sophisticated cross-chain theft, according to findings from blockchain investigator ZachXBT.
The attackers drained roughly 1.26 million XRP, moving the tokens through multiple cross-chain bridges and eventually routing them to over-the-counter (OTC) venues associated with Huione, an organization accused of facilitating global money laundering and scam operations in Southeast Asia.
In a detailed on-chain analysis shared on Oct. 19, ZachXBT traced over 120 Ripple-to-Tron swaps, showing the stolen funds consolidating on Tron before being dispersed across several OTC wallets. The entire laundering process reportedly took less than 72 hours.
“This appears to be a case of user mismanagement rather than a wallet vulnerability,” ZachXBT noted, explaining that the victim mistook a hot wallet for a cold-storage device. He added that hybrid products offering both custodial and non-custodial functions often confuse users, leaving them vulnerable to such attacks.
The breach comes amid a broader rise in crypto-related thefts. A recent TRM Labs report revealed that more than $2 billion in digital assets were stolen in the first half of 2025, primarily through front-end compromises, private key leaks, and wallet breaches. Most stolen funds, like in this case, are laundered via cross-chain bridges and unregulated OTC markets.
U.S. regulators have intensified scrutiny of Huione and its affiliates. Earlier this year, the Financial Crimes Enforcement Network (FinCEN) proposed sanctions targeting the Cambodian-based group, citing billions in suspicious flows linked to cybercrime.
Despite tracing the transactions, experts warn recovery chances remain slim due to delayed reporting and complex international jurisdictions.
At press time, XRP traded near $2.46, up 6% in the past 24 hours, as markets rebounded from last week’s multi-billion-dollar liquidation wave.
The incident underscores the ongoing risks of mismanaged wallets and the urgent need for improved user education and regulatory oversight in crypto security.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.