Privacy-Focused Exchange eXch to Shut Down Amid Allegations of Involvement in $1.5B Bybit Hack

In a dramatic turn of events, eXch, a Czech-based privacy-centric crypto exchange, has announced that it will cease operations on May 1 following mounting international scrutiny and allegations linking the platform to the laundering of funds from the $1.5 billion Bybit hack.

The announcement came via a post on the Bitcoin Forum on April 17, where the eXch team revealed that the project had become the focus of what they described as a “transatlantic operation” targeting key individuals with potential money laundering and terrorism charges.

Known for its minimalist approach to user verification, eXch positioned itself as a privacy experiment — not a profit-driven business. The team maintained that it never intended to enable illicit activity, stating that the platform was designed to offer instant, anonymous crypto swaps for users who value privacy.

Despite often being labeled a “mixer” by critics, eXch pushed back on this narrative. The team clarified that it is not a coin mixer in the traditional sense but rather a privacy-focused instant exchange with unique operational characteristics.

READ ALSO: EFCC Vows to Recover Funds from Collapsed CryptoBank Exchange (CBEX) Scam

Tensions escalated after blockchain analytics firms like Elliptic and TRM Labs identified eXch as a critical link in laundering efforts following the February 21 Bybit exploit, which saw an estimated 401,000 ETH drained from the exchange’s cold wallets.

The sophisticated laundering scheme — allegedly orchestrated by North Korea’s Lazarus Group — used a complex network of decentralized exchanges, cross-chain bridges, and privacy-preserving tools to obscure the stolen assets. eXch, as flagged by investigators, played a significant role in that web.

Initially, the platform dismissed reports of its involvement in the laundering operation. But it later admitted to having processed a “small portion” of the hacked funds — a move that may have fueled law enforcement action.

eXch claims to have received information from contacts within the “state intelligence sector” that confirmed its inclusion in ongoing investigations. Despite this, the team remains unapologetic about its mission.

In its shutdown statement, eXch criticized centralized exchanges and regulators for enacting “nonsensical policies” that, in its view, do little to genuinely curb money laundering while simultaneously compromising user privacy. “The goal of stopping eXch under the belief that it may stop all money laundering in the world is ridiculous,” the statement read.

Although eXch will no longer operate in its current form, the team is not disappearing quietly. They announced a 50 BTC fund (worth millions of dollars at current prices) to support open-source privacy projects within the Bitcoin and Ethereum ecosystems.

Additionally, eXch’s API will remain operational for a limited time, allowing partners to wind down their integrations while an incoming management team oversees the final transition of the platform. In a bold closing statement, the team reinforced their core belief: “Privacy is not a crime.”

The crypto space continues to grapple with the tension between privacy and regulation. As privacy-focused platforms like eXch shut down under regulatory heat, the debate over financial freedom, surveillance, and criminal misuse intensifies. While law enforcement agencies aim to curb crypto-related crime, privacy advocates warn against the unintended consequences of sweeping crackdowns — especially on tools designed with user rights in mind.