- Bitcoin bridging service Garden Finance has faced allegations that more than 80% of its recent fee revenue has come from laundering funds tied to the Lazarus Group
- Blockchain investigator ZachXBT has claimed the platform earned roughly $300,000 in fees linked to the $1.5 billion Bybit hack
- Garden Finance cofounder Jaz Gulati has rejected the accusations, saying that the fees were collected prior to the hack
Cross-chain swap protocol Garden Finance is under fire after blockchain investigator ZachXBT accused it of helping launder stolen funds linked to North Korean hackers. In a detailed thread posted on X, ZachXBT alleged that more than 80% of the platforms recent fee revenue came from laundering money tied to the February Bybit hack, a $1.4 billion theft attributed to the Lazarus Group. The claims have sparked a fierce debate over Gardens decentralization model, liquidity practices, and whether the project turned a blind eye to its role in facilitating illicit activity.
Illicit Funds Fuel Majority of Fees
On June 1, Garden Finance founder Jaz Gulati posted that the exchange had earned over 38 BTC in fees, and over the weekend, ZachXBT replied to the post to allege that a vast majority of this came from laundering Bybit hack funds:
Gulati responded that the 80% threshold had been reached months before the hack and that just 8 BTC had been earned since that point. This sparked a mini war of words, with ZachXBT adding, I did not even mention all of the other DPRK hacks yet like WazirX? This accusation went without reply.
Questions Over Decentralization
ZachXBT also highlighted system vulnerabilities within Garden Finance, calling the project fake decentralized bridge whose founders were not able to read the blockchain to analyze such flows. Gulati responded, fake decentralized, again with the misinformation, at which point Zach XBT revealed that he had data to back up his accusation:
If the comments following the spat are worth anything, its clear that the crypto community is behind ZachXBT on this one, with many criticizing Gurati for failing to defend himself and his companys actions further.
Garden Finance users will be hoping that Zach XBT is wrong and that the platform is decentralized and can be trusted as Gulati says, although, as many know to their cost, Zach XBT is rarely wrong.
