05 February 2025 , 19:12
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Andean Medjedovic is accused of exploiting DeFi protocols KyberSwap and Indexed Finance.
A federal court in New York unsealed on Feb. 3 a five-count criminal indictment against Andean Medjedovic for allegedly exploiting KyberSwap and Indexed Finance to steal $65 million.
Medjedovic has not been apprehended by law authorities as of Feb. 3 and remains at large.
According to a statement from the US Department of Justice, Medjedovic faces charges of wire fraud, unauthorized damage to a protected computer, attempted Hobbs Act extortion, money laundering conspiracy, and money laundering.
The charge of unauthorized damage to a protected computer carries a maximum penalty of 10 years in prison, while the other counts carry a potential 20-year sentence.
Court documents state that Medjedovic allegedly exploited automated smart contracts in the KyberSwap and Indexed Finance protocols between 2021 and 2023. Medjedovic is accused of borrowing tokens worth hundreds of millions of dollars to manipulate smart contract calculations.
This strategy allegedly allowed him to withdraw funds at artificial prices, rendering investors’ holdings worthless.
Authorities alleged that Medjedovic laundered the proceeds through swaps, bridging transactions, and crypto mixers. He is also accused of conspiring with others to open accounts at crypto exchanges using false and borrowed identities to obscure the funds’ origins.
The exploits
In November 2023, after executing the KyberSwap exploit and draining roughly $49 million, Medjedovic allegedly attempted to extort the victims.
He proposed a settlement in which he would gain control of the KyberSwap protocol and it’s governing decentralized autonomous organization (DAO) in exchange for returning half of the stolen assets.
In December 2023, KyberSwap committed to reimbursing affected users, offering grants from its treasury equal to the dollar value the user lost when the protocol’s liquidity pools were drained. The program became effective on Feb. 1, 2024, with KyberSwap announcing that 1,371 users were refunded on Feb. 3, 2025.
The incident also affected the decentralized exchange aggregator, which cut its workforce in half later that month.
Medjedovic is also the alleged perpetrator of Indexed Finance’s exploit taking place in 2021. Two of the protocol’s decentralized indexes were exploited while rebalancing, resulting in losses totaling $16 million.
Both protocols have yet to recover their total value locked (TVL) on the protocols following the security breaches.