Binance blockchain suffers $100 million hack
Hackers have stolen at least $100 million in tokens from Binance, in a rare blow to the world’s largest crypto exchange and another dent to the troubled digital asset industry struggling to regain confidence after a collapse in prices.
Binance estimated on Friday that tokens worth around $100 to $110mn had been taken, halting operations of the affected blockchain for about eight hours. The hack targeted the BSC Token Hub, a bridge between two Binance systems.
It comes at a time when digital assets are trying to recover from a credit crunch that wiped out nearly two-thirds of the value of its most high-profile tokens, such as bitcoin. Industry data has also indicated that theft from projects is sky high this year.
Cybercriminals had taken nearly $2 billion by the end of July, nearly double the total in the first seven months of last year, according to data from Chainalysis. High-profile thefts included $600 million from the blockchain behind popular crypto gaming platform Axie Infinity. Many hacks have been traced to state-sponsored actors in North Korea.
Binance’s position as the world’s largest crypto exchange means Friday’s exploit represents a significant blow to the digital asset industry.
In a series of social media posts, Changpeng Zhao, Binance’s founder and CEO, told users: “The problem is contained now. Your money is safe. We apologize for the inconvenience and will provide further updates accordingly.”
Binance asked the affected network’s validators, who secure the system, to pause their work. The funds were obtained from the BSC Token Hub, a bridge that allows customers to transfer tokens associated with one chain to another. The hack exploited a weakness that created extra BNB tokens on the network, according to Zhao.
Many of the world’s most widely used blockchains, such as Binance Smart Chain and Ethereum, run on separate technologies or use different tokens. That means investors and developers cannot easily move tokens to another blockchain to use or trade them elsewhere.
Binance estimated that around $7 million of the tokens had been frozen by the crypto community and its security operations.
Binance Smart Chain allows the world’s largest crypto exchange to open its doors to allow developers to build applications that use smart contracts, based on Binance’s own token. Binance launched the new chain in September 2020, at a time when the crypto industry was seeing a lot of interest in decentralized finance projects.
