When a major exchange gets compromised, Crypto hack laundering begins. Stolen tokens are never normally hoarded or cashed out; they are simply traded for Ether. It’s not a vote of confidence in Ether; it’s simply about control, speed, and minimizing the potential for funds to be frozen, tainted, or unusable. That move was repeated after the Binance hack and the Mercado Bitcoin attack, where the attackers moved all the tokens into ETH in those first hours.
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The Freeze Divide
The difference is fundamental in crypto hack laundering: issuer-controlled stablecoins like USDT and USDC have disabled addresses. Tether can blacklist one address and prevent USDT from moving. Circle can blacklist an address for USDC and halt deposits or withdrawals. Once frozen, neither balance can move unless the issuer intervenes. Native ETH has no issuer, no admin key, and no freeze.
Source: SOCRadar
No company can blackhole an ETH balance anywhere in the protocol. The only point of intervention is a little later when an account hits a regulated exchange and is banned from making the deposit. That distinction was important in the Binance case.
Source: PYMNTS
In a clear case of crypto hack laundering, issuers said in statements collected by Bitquery that Tether “immediately froze” $1.567 billion of USDT and Circle froze $823 million of USDC, about $3 billion in stablecoins altogether. 470,900 ETH remained in attacker wallets and were not blacklisted. Mercado Bitcoin froze more than $11 million of stablecoins, but the attacker turned 10.5 million dollars of other crypto into 4,605 ETH by 338 swaps, as Arkham Intelligence reported.
Also Read: Crypto Hack Losses Reach 89% North Korea Share, Chainalysis Finds
Liquidity, Speed, and the EVM Advantage
Most big exploits happen on Ethereum or EVM-compatible chains where ETH is the native gas asset, making crypto hack laundering faster. Without bridges and lag, attacking directly into ETH has its benefits. Speed is also a counterattack when investigators are moving within minutes.
ETH also has depth. Large volume of liquidity means the exploiter can amass big sums with less slippage than smaller altcoins. Then ETH can be used as a gateway. It can be split, bridged, or swapped. In the Binance example, investigators tracked a flow of SOL to USDC to ETH to Bitcoin via THORChain, a cross-chain protocol that doesn’t require an exchange account.
Source: Binance
Also Read: Crypto Hacks Surge as AI Cyber Threats Rise in 2026
What This Means for the Industry
For exchanges, freeze coordination can save a portion of stolen funds in crypto hack laundering cases, but it does not prevent any amounts converted to ETH or Bitcoin. Effective response at this stage now depends on wallet screening and intelligence sharing. For the regulator, this pattern underscores a fundamental cleavage.
Source: Remitly
Centralized stablecoins provide a compliance handle that our native assets do not, and that gap is exactly what drives crypto hack laundering. That distinction will inform future rules on issuances and freeze authorities, including the GENIUS Act, which mandates that authorized issuers adhere to freeze commands. For the builder, the core attributes that make ETH hard to freeze decentralization, censorship resistance, and no issuer control are at the heart of what makes Ethereum valuable, even as they also enable crypto hack laundering.
Source: Mudrex
For the investor, the effect is less direct via volatility and compliance costs, but public blockchains are transparent, and every swap is traceable, so firms like Arkham, Chainalysis, and Elliptic can follow. In the future, coordination between exchanges, issuers, and law enforcement will limit the lifespan of initial swaps, and cross-chain protocols will be pressured to build in screening tools as the FBI pressured THORChain. Yet, the ETH-centric pattern is not a market preference, but a rational response to the structure of crypto assets.
Also Read: April Crypto Hacks Hit Record High as Exploit Losses Reach $651 Million
Ananthyka J is a market reporter at Tronweekly, reporting on cryptocurrency news. She covers cryptocurrency markets, blockchain technology, and digital asset regulation, focusing on Bitcoin, Ethereum, DeFi, altcoins, and crypto policy. Her reporting emphasizes clear and accurate market coverage, including crypto market movements, regulatory developments, and blockchain adoption. She holds a BA in Journalism and Mass Communication and an MA in Communication and Media Studies. She has also completed multiple media internships, follows strict editorial and fact-checking standards, and discloses potential conflicts of interest when reporting.
