Pokémon fan charged with US$55mil crypto hack goes on trial

A Maryland cybersecurity consultant who allegedly stole nearly US$55mil (RM224.37mil) in hacked cryptocurrency and spent some of it on rare Pokémon and Magic: The Gathering cards went on trial in New York.

Jonathan Spalletta was charged in March with two 2021 hacks of cryptocurrency exchange Uranium Finance, which allegedly shut down as a result. Opening statements in the case began on Sept 28 in Manhattan federal court. Spalletta, who has pleaded not guilty, faces a maximum of 20 years in prison if convicted of the most serious charge against him.

Addressing the jury, federal prosecutor Shaun Werbelow said Spalletta "orchestrated a plan to destroy a whole cryptocurrency platform, to steal US$50mil (RM203.97mil) and then launder the money he stole.”

Defence lawyer Shrey Sharma conceded that Spalletta interacted with Uranium but denied that he hacked the platform, arguing that he didn’t use spoofed credentials or malicious code to bypass any access control system. Sharma said he used publicly available functions built into the exchange’s smart contracts – computer programs that automatically execute transactions when predetermined conditions are met.

The case has attracted some attention because of the collectables Spalletta allegedly bought with the hacks’ proceeds. The government seized from his Rockville residence more than US$3mil (RM12.24mil) worth of rare cards from the Magic: The Gathering and Pokémon games. The value of such cards has increasingly made them targets of crime.