U.S. authorities have charged 22-year-old Canadian Andean Medjedovic for allegedly stealing approximately $65 million from two decentralized finance (DeFi) protocols, Indexed Finance and KyberSwap.

The U.S. Department of Justice (DOJ) announced on February 3 that a federal court had unsealed a five-count indictment against him.

The Charges Against Medjedovic

According to court documents, Medjedovic manipulated smart contracts on the two platforms between 2021 and 2023, tricking the protocols into miscalculating key financial variables. This allowed him to withdraw funds at artificial prices, causing significant investor losses.

Prosecutors say he laundered the stolen money through digital asset swaps, bridging transactions, and crypto mixers in an attempt to hide the illicit proceeds.

U.S. Attorney John J. Durham described the alleged crimes as a highly sophisticated scheme to exploit two decentralized finance protocols and steal tens of millions of dollars’ worth of cryptocurrency from investors.

Authorities further allege that after the KyberSwap exploit, the accused sought to extort the protocol’s developers and investors, demanding full control of the platform and its DAO in exchange for returning half of the stolen assets.

Medjedovic is charged with wire fraud, unauthorized damage to a protected computer, attempted extortion under the Hobbs Act, and two counts of money laundering. If convicted, he could receive a maximum sentence of 10 years for the computer damage charge and up to 20 years for the other four counts.

The Suspect’s Trail

The Canadian has been on the run since stealing from Indexed Finance in 2021. He has defended his actions online by claiming they were legal under the disapproved code-is-law argument, which suggests that exploiting flaws in smart contracts is fair game.

In a 2023 interview with DL News, Medjedovic stated he had traveled through Europe and Latin America, eventually settling on an undisclosed island. While he dodged questions about the exploit, he insisted he had turned to ethical hacking as a more sustainable mode of being.

Months later, KyberSwap was drained of approximately $50 million in crypto. Blockchain investigators linked the incident to a wallet associated with the 22-year-old that later transferred $2 million to a separate one also tied to him.

After the exploit, prosecutors say he tried to move stolen crypto to Ethereum but was blocked by developers. Frustrated, he allegedly contacted support to demand they process the transaction.

Laurence Day, a co-founder of Indexed Finance, believes the suspect’s arrest will bring little relief to victims. He noted that much of the stolen crypto was later taken in a separate hack, complicating recovery efforts.