Atomic Wallet faces lawsuit over $100M crypto hack losses: Report

A group of disgruntled cryptocurrency investors have launched a class action against Atomic Wallet, which suffered a major breach and $100 million in losses in June.

Dozens of high-net worth investors from Russia and the Commonwealth of Independent States are part of the class action against Atomic Wallet, the German business media agency BNE IntelliNews reported on Aug. 21.

The lawsuit is being coordinated by German lawyer Max Gutbrod and Boris Feldman, a co-founder of Moscow legaltech firm Destra Legal.

Gutbrod, former partner of over two decades at Baker & McKenzie in Moscow, reportedly claimed that the lawyers are representing about 50 clients who lost a total of $12 million in the aftermath of Atomic Wallet’s breach two months ago. He said:

“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 massive $100-million exploit in mid-June 2023. The breach affected at least 5,500 crypto accounts on the platform. Crypto analytics firms such as Elliptic subsequently linked the heist to the North Korean cybercriminal team Lazarus Group, which is believed to be responsible for stealing billions in crypto through various thefts.

While initial reports blamed Lazarus for the attack on Atomic Wallet, the new claims suggested that there may be another culprit.

According to Feldman’s allegations, it is much more likely that a Ukrainian group had orchestrated the hack. His firm, Destra, has been working on the case with blockchain analytics at Match Systems, which has been working on its own investigation on behalf of the investors.

“They have found traces of involvement of Ukrainian hacker groups,” Feldman reportedly said.

As previously reported, Atomic Wallet didn’t clarify what conditions exactly led to the exploit in June. The firm only laid out the four most “probable” causes, including a virus on user devices, an infrastructure breach, a man-in-the-middle attack or malware code injection. Atomic Wallet also continued to reiterate that less than 0.1% of app users were affected.

Soon after going through the hack, the cryptocurrency wallet apparently continued operating as usual.

Atomic Wallet did not immediately respond to a request for comment.

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