- Binance has managed to halt a $541 million hack in its tracks
- Hackers targeted the BSC Token Hub bridge, freezing $430 million
- Such hacks typically originate from North Korea
Binance has managed to halt a $541 million hack on its BNB Chain by pausing the blockchain, trapping $430 million in stolen funds in the process. Following “irregular activity” on the chain last night, Binance froze the blockchain to assess what was happening and realised that a gargantuan exploit of its BSC Token Hub, a bridge to the BNB Chain, was taking place, with two million BNB tokens stolen among much else. In total, Binance estimates that some $100 million worth of coins were taken before the chain was stopped, preventing one of the biggest crypto hacks of all time.
Stolen Funds Quickly Frozen
Users were alerted to the fact that something was wrong when BNB Chain posted that the irregular activity had caused it to temporarily pause BSC. A “potential exploit” was then revealed with a Reddit post offering more detail, including an estimate of the damage:
Initial estimates for funds taken off BSC are between $100M – $110M. However, thanks to the community and our internal and external security partners, an estimated $7M has already been frozen.
This figure, however, included only those coins that were successfully taken off the exchange, and it soon became clear that the scale of the theft was much more than this:
2 million BNB. $500 million dollar hack
— Pizz (@KiefDurban2) October 6, 2022
Slowmist Revealed True Scale
Blockchain security company Slowmist were quick to uncover details, posting out a tweet thread that detailed the fast-moving events. Slowmist revealed that the value of the exploit was $541.7 million, although the swift actions of Binance in pausing the blockchain revealed that it had locked $430 million worth of stolen coins, meaning the hacker was unable to move the vast majority of what they had taken off the chain.
As well as these coins being locked, 4.8 million USDT tokens were blacklisted on the Ethereum network, which was followed by 1.73 million on the AVAX network.
Slowmist then revealed how the hacker was “trying to spread the funds to every network to launder the funds.” Of the two million BNB tokens stolen, the hacker deposited 900,000 into DeFi lending platform Venus Protocol in order to borrow almost $150 million in stablecoins, eventually interacting with 13 different DeFi platforms in order to make the most of their stolen haul.
Slowmist then offered a summary of the position as of a few hours ago:
Since the $BNB Chain was suspended, the ~$430M on it cannot be transferred any further.
In total, over $110M was moved off the BNB Chain
Frozen: ~6,5M $USDT
Supplied to lending pools: ~$37.5M
Borrowed: ~$16.5M
Still have access to: $83.3M pic.twitter.com/zxieESGblL— SlowMist (@SlowMist_Team) October 7, 2022
Binance Actions Will Reassure Regulators
Binance CEO Changpeng Zhao reassured users that their funds were safe, while referring to BNB Chain’s tweets that a protocol upgrade would ensure that the hackers could not move the locked $430 million worth of tokens.
While the act of freezing a blockchain may be the antithesis of how the system is supposed to work to some pursuits, this event is an example of what the public, and most importantly regulators, will want to see if they are to approve the use of cryptocurrency in anything like a large scale way.
Hacks of this scale have tended to originate in North Korea, and so if by halting the blockchain and freezing these funds Binance has helped prevent hundreds of millions of dollars heading to the North Korean missile program then that’s cause for celebration.
