Alleged SIM Swapper Used Stolen Bitcoin to Buy Luxury Cars

Francisco Memoria
  • An alleged SIM swapper has reportedly used stolen BTC to buy luxury cars, including a 2018 McLaren.
  • The hacker reportedly managed to see over 150 BTC flow through his wallets before being caught.

A 19-year-old teen named Xzavyer Narvaez, accused of seven counts of computer crimes, grand theft, and identity fraud, reportedly used bitcoin he stole from his victims to buy himself luxury cars.

According to Motherboard, Narvaez hijacked victims’ phone numbers in a technique known as SIM swapping to steal their bitcoin, as he presumably used access to victims’ numbers to go through their two-factor authentication (2FA) checks.

Motherboard’s report revealed DMV records police went through show Narvaez bought a 2018 McLaren, partly paid for in BTC, and partly through the trade-in of a 2012 Audi R8 that had been purchased with the flagship cryptocurrency in June of last year.

The report reads:

The investigators obtained records from Bitcoin payment provider BitPay, and cryptocurrency exchanges Bittrex. The records revealed that between March 12, and July 12 of this year, Narvaez’s account saw a flow of 157 Bitcoin (now worth around $1 million), according to a court document.

Digging deeper, Motherboard had multiple sources within the SIM swapping community reveal an individual going by Xzavyer was “one of the best SIM swappers out there.” The sources pointed to a now-deactivated Instagram account that went by “xza” and featured pictures of a white McLaren.

These were captioned with “live fast, die young.” Per the news outlet, the 19-year-old was released without bail this month.

The Investigation

Citing investigators at the Regional Enforcement Allied Computer Team (REACT), a task force of multiple California police departments investigating the growing SIM swapping trend, Motherboard revealed a cellphone used by Joel Ortiz, the first hacker in the US accused of the practice, had at one point logged into Narvaez’s Gmail account.

Per the findings, AT&T gave authorities the unique identifying numbers of the devices used to hijacked victims’ phones, and the coordinates of the cell phone towers these were connected to, along with Narvaez’s call records.

These records showed the hacker was connected to the same tower one of the victims was connected to, at the same time. After adding Apple account information to the mix, authorities were able to track down three victims – one of which claims to have lost $150,000 worth of crypto last year.

The SIM swapping trend has made hundreds of victims around the US, as criminals have been targeting cryptocurrency investors and people with short, unique Instagram names that can be resold on the gray market.

As CryptoGlobe covered an American crypto investor, Michael Terpin, filed a $224 million lawsuit against AT&T after the phone carrier’s alleged “gross negligence” in a SIM swapping case cost him $24 million in cryptocurrency.

HTC Says Its Latest Cryptophone Puts 'A Metaphorical Swiss Bank in Your Pocket'

On Saturday (October 19), Taiwanese smartphone manufacturer HTC launched the Exodus 1s, which it says is "the first ever mobile device with Bitcoin Full Node support."

A Brief History of HTC's Experience With Building Crypto-Friendly Phones

On 15 May 2018, at the Consensus 2018 blockchain summit in New York City, Phil Chen, the "Decentralized Chief Officer" (DCO) for HTC announced the firm's plan to create HTC Exodus, "the world's first native blockchain phone."

The first Exodus model to launch was the Exodus 1, which went on sale in Europe and the U.S. late last year. It initially cost 0.15 BTC (though later, it became possible to buy it for $699). HTC's reason for calling this a "blockchain phone" was that it came with a built-in hardware wallet and a pre-installed Decentralized Apps (DApps) browser that was integrated with this hardware.

HTC says that its wallet app, Zion Vault, "uses the Trusted Execution Environment (TEE) to protect your private keys and sensitive data," and that it supports storing, sending, and receiving organize over 100 types of cryptocurrencies."

The HTC Exodus 1 is a dual-sim Android-powered phone with the following specs:

  • 6.0” Quad HD+ display with 18:9 aspect ratio
  • Qualcomm® Snapdragon™ 845 processor
  • 3500mAh battery
  • Android Oreo (i.e. Android version 8.x)
  • 128GB of storage and 6GB of RAM

What happened next is that HTC used its experience with the Exodus 1 and feedback from developers and the market to build a more budget-friendly device: the Exodus 1s. This is the device that HTC introduced yesterday at the two-day Lightning Conference in Berlin. In fact, HTC started selling some of the first production units at this event, and was even accepting payments via Bitcoin's Lightning Network. Other cryptocurrencies that HTC accepts as means of payment are Ether (ETH), Litecoin (LTC), Binance Coin (BNB), and Bitcoin Cash.

The HTC Exodus 1s

So now know that HTC has two crypto-friendly phones, the Exodus 1 and the Exodus 1s. These days, HTC has a new term to describe its crypto-friendly Exodus phones; on the Exodus website, it says  "SMARTPHONE + HARDWARE WALLET = CRYPTOPHONE". This means that HTC is currently selling two cryptophones.

What is special about the HTC Exodus 1 is not just its lower price (EUR 210, which is approximately USD 235), but the fact that, according to HTC, it is the first mobile phone that supports running a Bitcoin full node (with the blockchain data to be stored on a 400GB microSD card that needs to be purchased separately).

HTC says that running a Bitcoin full node on your phone "not only grows the Bitcoin network, but also help secure it." HTC also believes that it is better not to "wait for others to verify your transactions", and that with this phone, you can "verify yourself, anytime, anywhere."

Here is Chen (HTC's DCO) explaining to Forbes the significance of running your Bitcoin full node:

It plays a really important role in the whole bitcoin ecosystem. It allows you to relay transactions, confirm transactions, validate transactions, and it’s basically one of the best ways for anybody to contribute to the whole security of the network.

According to Techcrunch, Chen believes that with the Exodus 1s, you can essentially have a "a metaphorical Swiss bank in your pocket":

We gave users the ability to own their own keys, and now we’ve gone one step further to allow users to run their own full Bitcoin node. We are providing the tools for access to universal basic finance; the tools to have a metaphorical Swiss bank in your pocket.

Chen also told Forbes that HTC is considering adding support for other major blockchains:

We’ll certainly learn a lot of how people will interact with bitcoin, what they do with a full node, and we want to apply those learnings to future other public blockchains.

 These are the specs for the HTC Exodus 1s:

  • 5.7” HD+ 18:9 display
  • Qualcomm® Snapdragon™ 435 processor
  • 3000mAh battery
  • Android Oreo 8.1
  • 64GB of storage and 4GB of RAM

The HTC Exodus 1s will be initially available in Europe, Taiwan, Saudi Arabia and the UAE (but HTC plans to offer the phone at some future date in other countries).

In case you are wondering why HTC is so interested in crypto, this is what Chen told CNBC:

Initially considered a gimmick by some, crypto technology is the next frontier of smartphone innovation. For the smartphone category to grow again, we need more adoption of cryptophones.

HTC's CEO said in an interview with Techcrunch that although we don't yet have mainstream adoption of cryptophones, the Exodus 1s gives consumers "an inexpensive way to see what the technology provides today."


Featured Image Courtesy of HTC