Crypto privacy protocol Railgun's built-in tool to filter out bad actors has seemingly foiled Inferno Drainer's latest attempt to launder its stolen cash.

In a July 10 post to X, MistTrack noted that a July 9 attempt to launder a little over 174 Ether (ETH) — worth $533,000 at current prices — was blocked by Railgun

A built-in tool within crypto privacy protocol Railgun appears to have thwarted Inferno Drainer’s latest attempt to launder its stolen cryptocurrency.

On July 10, MistTrack noted in a post to X that an attempt on July 9 to launder a little over 174 Ether (ETH) — roughly $533,000 at current prices — was blocked by Railgun, forcing the attacker to send the stolen ETH back to Inferno’s original wallet address.

According to Railgun contributor Alan Scott Jr., Inferno’s malicious attempt to use the Ethereum-based privacy protocol was blocked by Railgun’s automated Private Proofs of Innocence (Private POI) system.

Once the Private POI system was activated, “the tokens could only return to the attacker’s address — they were not welcome in RAILGUN,” said Scott.

Launched by the protocol’s researchers and contributors in January 2023, Railgun’s Private POI system uses cryptographic assurance to ensure that tokens entering the Railgun smart contract are not from a known list of undesirable transactions or actors.

To do this, users are required to create a ZK-proof that their funds are not part of a pre-set list of transactions and wallets, which includes stolen funds or funds from sanctioned entities.

According to Scott, the Private POI system picks up transactions linked to nefarious actors and then blocks the tokens from being processed through the protocol. The only option available to the sender is to withdraw the tokens back to the original address.

“That transaction flow remains trackable, and attempting to use RAILGUN provides zero privacy to that actor,” he added.

Since its launch in August 2023, Inferno Drainer has reportedly stolen over $180 million in crypto from more than 189,000 victims, according to Dune Analytics.

In April this year, Railgun also hit back at claims from independent crypto reporter Colin Wu, who alleged that the protocol had been used by the North Korean hacking consortium Lazarus Group.

Despite blockchain security firm Elliptic labeling Railgun a “prime alternative to Tornado Cash” after the U.S. government imposed sanctions on the crypto mixer, Ethereum co-founder Vitalik Buterin has defended the protocol, stating that privacy is “normal.”

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