Wormhole hacker becomes the third largest holder of stETH

After the $320 million hack of the Wormhole blockchain bridge in February 2022, much of the funds remained dormant. Now, however, the hacker seems to have returned. On January 23, they took 95,360 ETH (~$157 million) of the 120,000 ETH they stole (now worth substantially less) and used it to lever up a position in stETH. stETH is Lido-staked Ether, an asset representing ETH that has been staked on Ethereum since it moved to the proof-of-stake model.

Ultimately, the Wormhole hacker became the third-largest holder of stETH as a result. The size of the swaps was so large that it moved the stETH market, increasing trading volume by 3000% and temporarily causing the asset to move above its usual 1:1 peg with Ethereum.

The move, which many crypto enthusiasts took as an indication that the Wormhole hacker was a "crypto degen", is unlike the activities of many crypto hackers, who typically try to launder the money and exit into fiat rather than keep it within the crypto ecosystem.