In the latest court ruling, a former security engineer, Shakeeb Ahmed, has been handed a three-year prison sentence. Ahmed was found guilty of hacking and embezzling $12 million from two decentralized exchanges. Additionally, United States District Judge Victor Marrero has mandated Ahmed to surrender approximately $12.3 million.

The trial revealed that Ahmed was involved in hacking two decentralized exchanges (DEX), marking a precedent for smart contract breaches. As part of his sentencing, Ahmed is required to relinquish digital assets in addition to the embezzled funds. Statements from the United States Attorney’s Office outlined that Ahmed must reimburse around $5 million to Nirvana and an unnamed DEX.

The charges initially stemmed from Ahmed exploiting a vulnerability within a decentralized exchange's smart contract. By manipulating pricing data, he successively generated over $9 million in exaggerated fees. Following the crime, Ahmed converted the illicit proceeds into cryptocurrency and withdrew the sum. In an attempt to avoid detection, he offered to return $1.5 million to the DEX under the condition that legal authorities were not contacted.

Shortly after the first incident, Ahmed targeted the platform Nirvana Finance for another hack. Utilizing a flaw in the platform's smart contract, he acquired tokens at a reduced rate and promptly resold them back at their original value. Despite Nirvana's offer of a $600,000 bug bounty reward, Ahmed demanded $1.4 million, leading to a deadlock where he retained the entire sum.

To conceal his illicit activities, Ahmed employed various tactics, such as transferring tokens from the Solana blockchain to Ethereum and converting the stolen funds into the privacy token Monero. Despite his efforts to obfuscate the trail, law enforcement detained Ahmed in July 2023, culminating in his recent sentencing.

United States Attorney Damian Williams commended the court's decision to incarcerate Ahmed, emphasizing the significance of prosecuting such cybercriminal activities. He underscored the commitment to tracking digital assets and ensuring accountability for hackers, regardless of the complexity of their schemes.