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Kraken User Loses $18.2M in Crypto Social Engineering Attack as Funds Move via Thorchain

News.Bitcoin • March 31, 2026

A Kraken user appears to have lost roughly $18.2 million in cryptocurrency after a suspected social engineering attack, with stolen funds now moving across blockchains .

Blockchain investigator ZachXBT flagged the incident on March 31, 2026, via his Telegram channel, pointing to a coordinated theft followed by rapid asset transfers designed to obscure the trail. The attacker reportedly gained access through tactics commonly tied to phishing or impersonation schemes, rather than exploiting a technical flaw in the exchange itself.

Initial movements show funds being bridged from the Ethereum network to Bitcoin using Thorchain, a decentralized protocol that allows assets to move between blockchains without centralized intermediaries. Onchain data indicates that roughly 878 ether, valued at $1.8 million at the time, was part of the early laundering flow tied to the incident.

The transfers are reportedly being routed through a Safepal wallet, adding another layer of separation as the attacker shifts funds between chains and addresses. Analysts have identified multiple wallet addresses linked to the theft , including a primary ether address and additional associated accounts, along with a bitcoin destination address receiving bridged funds.

These addresses are now being tracked in real time by onchain analysts as the funds continue to move, often in quick succession, a common tactic used to reduce traceability. The incident reflects a broader pattern seen throughout 2026, where social engineering remains one of the most effective methods for draining user funds in the digital asset space.

Rather than targeting smart contract vulnerabilities, attackers increasingly focus on human behavior, convincing victims to reveal seed phrases , approve malicious transactions, or interact with fraudulent support channels. In many cases, the approach involves impersonating exchange staff or wallet providers, creating a false sense of urgency that pushes users to bypass standard security precautions.

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The case highlights the risks tied to account-level access and user-side security practices. Security specialists continue to recommend that users avoid sharing private keys or recovery phrases under any circumstances and verify all communications claiming to be from exchanges.

Additional safeguards such as hardware wallets, two-factor authentication, and withdrawal whitelists can help reduce exposure, particularly for large holdings.

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This article is one source in a clustered incident — the cluster page carries the summary, timeline and every other outlet covering it.

Kraken User Loses $18.2M in Social Engineering Crypto Attack A Kraken user has lost approximately $18.2 million in a suspected social engineering attack, as reported by blockchain investigator ZachXBT on March 31, 2026. The attack involved manipulation techniques, likely phishing or impersonation, rather than a breach of Kraken's infrastructure. Following the theft, the stolen funds have begun moving across blockchains, with initial transfers from Ethereum to Bitcoin using Thorchain. Early on-chain data indicates that around 878 ether, valued at $1.8 million, was part of the laundering process. The attacker is using multiple wallet addresses and a Safepal wallet to obscure the trail of the stolen assets. This incident highlights the increasing sophistication of social engineering attacks in the cryptocurrency space, where user behavior is targeted rather than technical vulnerabilities. Security experts emphasize the importance of user awareness and robust security practices to mitigate such risks. The ongoing movement of the stolen funds is being tracked by analysts in real time. 3 sources 69

Extracted Entities

Kraken User Loses $18.2M in Crypto Social Engineering Attack as Funds Move via Thorchain

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Extracted Entities

Attack Types (1)

Companies (1)

MITRE ATT&CK (1)

Platforms (3)