Former Cryptopia Employee Pleads Guilty to Stealing $176,000 in Crypto

The unnamed former staffer allegedly persuaded Cryptopia's management to get access to the private keys of the wallets.

A former employee from the disgraced New Zealand-based cryptocurrency exchange Cryptopia has pleaded guilty to stealing $176,000 worth of crypto assets and customer data from the platform. According to Stuff.co.nz, the former staffer, which was no named by the court, admitted the crime before Judge Gerard Lynch at the Christchurch District Court on Monday.

The now collapsed exchange had over 80 employees operating, with a customer base of over 1.4 million globally. The unnamed employee was accompanied by his lawyer, Allister Davis, and pled guilty on two charges: theft by a person in a special relationship and theft of more than $1,000. The court determined that he had to be convicted and remanded on bail until sentencing on October 20, 2021.

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Per the investigation, the former staffer persuaded Cryptopia’s management to discuss security-related matters of the exchange to get access to the private keys of several wallets. However, the then-employee made unauthorized copies of the keys, stored them on a USB device, and proceeded to download all the information, plus extracting the funds from his personal computer at home. The former staffer was not involved in the case of the two hacks that took down the New Zealand-based exchange, and his charges are not related to it.

Cryptopia Saga Background

In 2019, Cryptopia announced a security breach that resulted in a “significant loss.” According to an official Tweet by the exchange, the hack took place on January 14, and subsequent reports noted that the stolen funds were around $30 million in cryptos at that time. Due to the incident, the company owner of Cryptopia had to be liquidated in May 2019, and Grant Thomton, an accountancy firm, had managed the process since then.

Last year, GNY, a machine learning platform for blockchain applications, opened fire on liquidators for Cryptopia, alleging that they failed to comply with their duties.

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