Shakeeb Ahmed, a former security engineer, has been sentenced to three years in prison for hacking decentralized exchanges and stealing over $12 million in digital assets. This landmark case marks the first-ever conviction for a smart contract hack.
A former security engineer, who extracted digital assets worth over $12 million from two decentralized exchanges, has been sentenced to three years in prison in what is being called the “first-ever” conviction for a smart contract hack. Additionally, the U.S. Judge mandated the former engineer to forfeit approximately $12.3 million.
Shakeeb Ahmed, a former security engineer convicted of hacking two decentralized cryptocurrency exchanges, has been sentenced to three years in prison by U.S. District Judge Victor Marrero. Alongside his prison sentence, Ahmed is required to forfeit around $12.3 million and a substantial amount of cryptocurrency.
The U.S. Attorney’s Office stated that Ahmed is also obligated to pay over $5 million in restitution to Nirvana and the affected decentralized exchanges. Following his prison term, Ahmed, aged 34, will undergo three years of supervised release.
In December 2023, Ahmed confessed to exploiting a flaw in the smart contract of one of the decentralized exchange platforms. He then tried to launder the pilfered digital assets by converting them into a privacy-focused cryptocurrency. Despite his efforts to evade detection, U.S. authorities arrested Ahmed in July 2023.
On the occasion of Ahmed’s sentencing nearly four years after his guilty plea to computer fraud, U.S. Attorney Damian Williams remarked:
“Today [April 12], Shakeeb Ahmed was sentenced to prison in the first-ever conviction for the hack of a smart contract and ordered to forfeit all of the stolen crypto. No matter how novel or sophisticated the hack, this Office and our law enforcement partners are committed to following the money and bringing hackers to justice.”
Williams emphasized that Ahmed’s sentence should act as a deterrent to other hackers contemplating similar crimes.
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