Crypto Investors Sue Atomic Wallet Over $100 Million Hack

A group of dissatisfied cryptocurrency investors have filed a class action lawsuit against Atomic Wallet, which suffered a significant security breach and $100 million in losses in June.

BNE IntelliNews reported on August 21 that dozens of wealthy investors from Russia and the Commonwealth of Independent States have joined the class action lawsuit against Atomic Wallet.

The litigation is being coordinated by German attorney Max Gutbrod and co-founder of the legal tech firm Destra Legal in Moscow, Boris Feldman.

Gutbrod, a former partner at Baker & McKenzie in Moscow for over two decades, reportedly claimed that the attorneys represent approximately 50 clients who lost a total of $12 million as a result of the breach at Atomic Wallet two months ago.

“We are working on recovering the assets for our clients and we will be filing a class action against Atomic Wallet […] They didn’t give our clients any information about the hack or go to the police to report it.”

Atomic Wallet, the noncustodial cryptocurrency wallet, suffered a $100 million hack in mid-June 2023, according to him. At least 5,500 crypto accounts on the platform were compromised.

Subsequently, crypto analytics firms such as Elliptic linked the theft to the North Korean cybercriminal group Lazarus Group, which is believed to be responsible for the theft of billions of dollars worth of cryptocurrency via multiple robberies.

Initial reports implicated Lazarus in the attack on Atomic Wallet, but new claims implicate a different party. According to Feldman’s claims, it is far more probable that a Ukrainian group was responsible for the attack.

His firm, Destra, has been collaborating with blockchain analytics at Match Systems, which has been conducting its investigation on the investors’ behalf.

“They have discovered evidence of involvement by Ukrainian hacker groups,” Feldman was quoted as saying. As previously reported, Atomic Wallet did not specify the precise circumstances that led to the June exploit.

The company only listed the four most “probable” causes, which included a virus on user devices, an infrastructure compromise, a man-in-the-middle attack, and the injection of malware code.

Additionally, Atomic Wallet reaffirmed that less than 0.1% of app users were affected. Immediately after the breach, the cryptocurrency wallet reportedly resumed normal operation.