ZachXBT Links $40M Theft to CMDSS Contractor’s Son

How the theft was traced

The stolen crypto came from government-held wallets connected to past enforcement actions, such as the Silk Road and Bitfinex cases. These wallets, managed by agencies like the U.S. Marshals Service (USMS), were meant to securely hold confiscated assets. However, this breach exposed serious flaws in how federal agencies store and protect digital assets.

ZachXBT’s investigation began after Daghita publicly showed off a wallet holding $23 million. On-chain analysis linked that wallet to over $90 million in suspicious movements, including the $40 million siphoned directly from government wallets. The transactions pointed to insider access, as the seized funds had been stored in secure wallets previously under federal custody.

Daghita’s Telegram account briefly reappeared after the news broke, suggesting he is still active online.

ZachXBT Ties Lick To CMDSS

The story took a deeper turn when it was revealed that John Daghita is the son of Dean Daghita, the CEO of CMDSS, a Virginia-based IT firm. CMDSS held an active contract with the USMS to help manage and dispose of seized cryptocurrency assets. That contract may have given the Daghita family direct or indirect access to government wallets.

Although it’s unclear exactly how John accessed the funds, many now suspect that insider knowledge or credentials tied to CMDSS were involved. CMDSS has since taken down its website, social accounts, and LinkedIn page, which raised even more questions about the company’s role.

How the funds were moved

Once the crypto was stolen, Daghita allegedly used a network of Tether (USDT) wallets to launder the money. He split large amounts into smaller transactions, routed them through intermediary wallets, and eventually consolidated them into a central wallet. This method helped obscure the origin of the funds but couldn’t hide them from experienced blockchain analysts like ZachXBT.

Src: X (ZachXBT)

What happens now

So far, neither the USMS nor CMDSS has released a public statement. There’s also no word on whether any of the stolen funds have been recovered or if criminal charges have been filed. The silence from officials has frustrated many in the crypto community who want better safeguards for government-held assets.

This incident isn’t the first time government crypto holdings have been targeted. It joins a list of past hacks and insider threats, underscoring how vulnerable even state-managed wallets can be. The fact that this theft may have happened through a government contractor only adds to the urgency for reform.

Why it matters

With the U.S. government holding nearly 200,000 BTC in seized assets, proper custody is essential. The breach connected to CMDSS highlights the need for stronger protocols, better contractor vetting, and transparent audits.

ZachXBT’s investigation has done more than just expose a single theft. It’s sparked an industry-wide discussion about how crypto should be handled, especially by institutions that can’t afford mistakes.