A US court has sentenced Shakeeb Ahmed to three years in prison for breaching security measures on two separate decentralized cryptocurrency exchanges and embezzling digital assets valued at over $12 million, as stated by the US Department of Justice on April 12.

This marks the first conviction related to hacking smart contracts. US attorney Damian Williams emphasized the commitment to prosecuting such crimes, stating that imprisonment and forfeiture of stolen cryptocurrency are the inevitable outcomes.

Ahmed must forfeit around $12.3 million in assets, including a substantial amount of cryptocurrency, and pay over $5 million in restitution to the unnamed exchange and Nirvana.

In 2022, Ahmed exploited vulnerabilities in the smart contracts of two decentralized exchanges, including Nirvana and an unnamed platform, to access a significant volume of digital assets.

He manipulated pricing data on the unnamed exchange, pocketing approximately $9 million in inflated fees and withdrawing the funds in cryptocurrency. Ahmed returned approximately $7.5 million to the exchange under the condition of avoiding legal intervention.

Shortly after, he targeted Nirvana Finance, stealing roughly $3.6 million by exploiting the smart contracts to buy crypto at lower prices and sell it at higher rates.

Despite Nirvana offering a $600,000 reward, Ahmed demanded $1.4 million, leading to a stalemate and the retention of all stolen funds, resulting in the exchange's closure.

Ahmed then laundered the stolen assets using sophisticated methods like token-swap transactions and advanced crypto mixers such as Samourai Whirlpool.

At the time of the crimes, Ahmed held a senior security engineer position at an unnamed international technology firm.