**Crypto Security Roundup: CryptoMixer Shutdown, AI Exploits Smart Contracts, and More**

Here’s a quick breakdown of the latest cybersecurity developments in the crypto world, from law enforcement takedowns to AI threats and major hacks.

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**CryptoMixer Shut Down by Authorities**

Swiss and German police, with help from Europol, have shut down a major crypto mixing service called CryptoMixer. They seized three servers in Switzerland, took over the cryptomixer.io domain, and collected over 25 million euros in Bitcoin along with 12 terabytes of data.

CryptoMixer was used by hackers, ransomware groups, and dark web markets to hide where their crypto came from. Since 2016, it helped launder over 1.3 billion euros in Bitcoin by mixing user funds to make them untraceable.

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**AI Can Hack Smart Contracts, Says Anthropic**

AI company Anthropic has found that its advanced AI agents can exploit smart contract vulnerabilities on blockchains like Ethereum and BNB Chain. Using AI models like Claude Opus 4.5 and Claude Sonnet 4.5, they ran tests in a simulated blockchain environment.

The AI successfully hacked 17 out of 34 vulnerable contracts, grabbing $4.5 million in fake funds. When tested on a larger set of 405 smart contracts, the AI exploited 207 of them, simulating a total gain of $550 million. Even when the AI scanned over 2,800 new contracts, it found two zero-day bugs worth nearly $3,700 — though this scan cost $3,476 to run via API.

This shows that AI could be used to discover and exploit blockchain vulnerabilities at scale.

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**UK Plans to Ban Crypto Political Donations**

The UK government is planning to ban political donations made with cryptocurrencies. Officials are concerned that crypto donations are hard to trace and could allow foreign or criminal money into British politics.

The move would impact parties like Reform UK, which recently started accepting crypto donations. The Electoral Commission originally said the risks were manageable but now warns that tracking the source of crypto funds is difficult and expensive.

Any ban would likely need stronger laws to block foreign influence through digital assets.

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**Do Kwon Seeks Shorter Sentence for Terra Collapse**

Terraform Labs founder Do Kwon is asking a U.S. judge for a lighter sentence — no more than five years — after pleading guilty to fraud tied to the $40 billion Terra-Luna collapse in 2022.

In court documents, his lawyers say Kwon didn’t act out of greed but out of desperation. He admitted to misleading investors by hiding a deal with Jump Trading meant to stabilize TerraUSD. Kwon has already spent nearly two years in detention in Montenegro and still faces charges in South Korea. His sentencing is set for December 11.

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**Lazarus Group Suspected in $30M Upbit Hack**

North Korea’s infamous Lazarus Group is suspected of stealing about $30 million in crypto from Upbit, South Korea’s largest exchange. Upbit noticed abnormal withdrawals involving Solana-based assets and halted transactions.

Investigators believe hackers used admin account impersonation — similar to Upbit’s 2019 breach, which was also blamed on Lazarus. Blockchain data shows the stolen crypto is being swapped for USDC and bridged to Ethereum.

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**Balancer Proposes $8M Payout After Major Hack**

Decentralized finance (DeFi) platform Balancer plans to repay users around $8 million after a recent hack drained over $128 million from its vaults.

Out of $28 million recovered so far, about $19.7 million is still held by liquid staking platform StakeWise. The proposed reimbursement will go to liquidity providers affected by the exploit. Funds will be distributed based on user balances at the time of the attack and will be paid in the same tokens that were recovered.

White hat hackers who helped recover funds will get 10% bounties — up to $1 million each — if they pass ID checks. There will be a 180-day window for users to claim their refunds.

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**Yearn Finance Recovers $2.4M After yETH Exploit**

Yearn Finance has recovered $2.4 million of the nearly $9 million lost in an attack on its older yETH pools. The exploit was caused by a bug that let the attacker mint an unlimited supply of yETH tokens.

The attacker used these fake tokens to swap for real assets and moved at least 1,000 ETH through Tornado Cash for laundering. The newer Yearn V2 and V3 vaults weren’t affected.

Yearn is working with security experts from SEAL 911, ChainSecurity, and Plume to track down more funds and return them to affected users.

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**Key Takeaways for Crypto Users**

– Crypto mixing services like CryptoMixer are prime targets for law enforcement.
– Advanced AI can now exploit smart contracts without human help.
– Governments are tightening rules on crypto to prevent misuse.
– High-profile figures like Do Kwon are facing serious legal consequences.
– North Korean hackers remain highly active in targeting exchanges.
– DeFi platforms are under constant threat but are improving recovery efforts.

Stay updated and secure — the crypto space moves fast, and so do its risks.