In a groundbreaking legal case, Shakeeb Ahmed, a former technical lead at Amazon, has been sentenced to three years in prison for hacking smart contracts on two decentralized exchanges (DEXes), marking the first conviction of its kind.

Ahmed conducted flash loan attacks on the Crypto Exchange and Nirvana exchanges in 2022, leading to the theft of $12.3 million, along with a significant amount of undisclosed cryptocurrency. He was ordered to return the stolen funds and compensate the exchanges with $5 million.

In a dramatic turn reminiscent of a Hollywood thriller, Ahmed attempted to negotiate with the exchanges, offering to return the stolen funds, excluding $1.5 million, in exchange for Crypto Exchange's silence. Despite Nirvana's offer of $600,000 for the return of the funds, Ahmed demanded $1.4 million. The failure to reach an agreement resulted in NIRV, Nirvana’s stablecoin, disassociating from the U.S. dollar and a drastic 85% drop in the value of its native ANA coin.

Ahmed allegedly laundered the stolen funds through token-swap transactions and "bridging" tactics, transferring them from the Solana blockchain to the Ethereum blockchain. He also converted proceeds into Monero cryptocurrency, utilized overseas cryptocurrency exchanges, and employed cryptocurrency mixers like Samourai Whirlpool.

Although a third exchange, Crema, reportedly experienced a similar attack in July 2022, no direct link to Ahmed was established in the charges against him. Initially arrested in New York in July and charged with wire fraud and money laundering, Ahmed later pleaded guilty to a single charge of computer fraud in December. Following his release on bail, Ahmed is said to be currently employed at a mental health startup.