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In this episode, Geoff White (https://x.com/geoffwhite247) tells us what happened to Axie Infinity and Tornado cash. It’s a digital heist of epic proportions that changes everything.This story comes from part of Geoff’s book “Rinsed” which goes into the world of money laundering. Get yours here https://amzn.to/3VJs7pb.
The episode begins with the host, Jack, reflecting on an art heist—the Isabella Stewart Gardner Museum theft of 1990, which involved stolen artworks worth $500 million. This leads to a discussion about digital crime, specifically a new record set in 2022 by a digital heist that surpassed the infamous art heist. Jack hints at the complexities of valuing art versus digital assets, illustrating the confusing nature of ownership in the digital realm.
Jack dives deep into the concept of digital ownership. He discusses various digital assets like audiobooks, photos, and online accounts, expressing skepticism about true ownership. He highlights how users often do not own their purchases on platforms like Audible or social media accounts, raising important questions about the nature of ownership in a world increasingly dominated by digital interactions.
The podcast introduces Axie Infinity, a blockchain-based game that revolutionized the gaming industry, allowing players to earn cryptocurrency while playing. The conversation includes insights from Geoff White, detailing the game’s mechanics, how players can earn and trade in-game assets, and its massive popularity in regions like Southeast Asia during the COVID-19 lockdown.
The episode centers on the infamous hack of Axie Infinity, where $625 million in cryptocurrency was stolen, attributed to North Korean hackers. Jack discusses the intricacies of the Ronin Network and the methodical approach hackers took to target a major point of vulnerability, ultimately leading to the massive heist.
The discussion shifts to the aftermath of the hack, including the challenges of laundering stolen cryptocurrency. Jack and Geoff explore the limitations of traditional financial institutions in the context of cryptocurrency, and how facilities like Tornado Cash provide anonymity for users and complicate the legal landscape when it comes to financial regulation.
The podcast concludes with a conversation on privacy concerns surrounding tools like Tornado Cash, which, while providing necessary anonymity for users, have been demonized by authorities. Jack debates the implications of government-sanctioned restrictions on privacy tools and the potential erosion of personal freedoms in the name of security.
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