eXch, a cryptocurrency exchange renowned for its emphasis on privacy and operations without Know-Your-Customer (KYC) requirements, has announced plans to cease operations by May 1, 2025.
The decision follows allegations linking eXch to the $1.4 billion Bybit hack in February 2025, which reportedly involved laundering funds through its platform.
The hack was attributed to North Korea’s infamous Lazarus Group by the Federal Bureau of Investigation (FBI).
In an April 17 announcement, eXch disclosed that an “active transatlantic operation” targeting its infrastructure was underway, potentially escalating to money laundering and terrorism financing charges against its team.
This development was said to be driven by evidence from a whistleblower affiliated with the U.S. Department of Justice (DOJ).
eXch’s Response and Allegations
Johann Roberts, CEO of eXch, addressed the situation, stating, “We don’t see any point in operating in a hostile environment where we are the target of SIGINT simply because some people misinterpret our goals.”
- Roberts referred to SIGINT—short for Signals Intelligence—a method of gathering intelligence, which indicates the scale of scrutiny eXch is facing.
- The exchange initially denied allegations of laundering money for Lazarus/DPRK (Democratic People’s Republic of Korea), attributing discrepancies to outdated data from its third-party anti-money laundering (AML) screening provider.
- According to eXch, this delay caused a roughly 12-hour gap in updating information related to the hacked Ethereum addresses.
Subsequent investigations revealed that eXch had processed a “minor portion” of the stolen funds—approximately 90,000 Ethereum (ETH)—which were laundered through multiple centralized and decentralized services.
However, this amounted to only a fraction of the 401,346 ETH siphoned during the Bybit attack. Roberts also cited the refusal of Bybit’s cooperation with eXch, claiming previous “direct attacks” had damaged eXch’s reputation and strained relations.
Challenges and Industry Criticism
eXch’s operational model as a non-KYC, accountless exchange has long been controversial, attracting scrutiny from investigative groups like Elliptic and ZachXBT.
Roberts criticized what he called “elitist policies” within the industry, particularly aimed at privacy-centric platforms. He claimed Elliptic had declined eXch’s requests for service due to its privacy-focused approach.
In its closing statement, eXch took aim at prevailing AML practices across the industry, describing them as “nonsensical policies” that can be “easily bypassed.”
The exchange argued that these mechanisms fail to prevent illicit activity effectively while undermining the principles of user privacy.
What you should know
Until its closure on May 1, eXch will continue providing API access to partners.
- Decisions regarding future operations will be left to a new management team, raising questions about the potential rebranding or restructuring of the platform.
- The controversy surrounding eXch underscores broader challenges in the cryptocurrency industry, including the delicate balance between user privacy and regulatory compliance.
The closure marks a significant development in the ongoing debate over the role and accountability of privacy-focused exchanges in the crypto ecosystem.
