Science & Tech · Cybersecurity · 4 hrs ago
Exchange security gaps can expose crypto even when blockchains hold
A suspected Binance hack may have cost about $6.3 billion after attackers may have used access to the exchange’s systems to submit unauthorised withdrawals.
Binance said its initial investigation indicated that an engineer’s laptop had been compromised, but the precise attack route remains under investigation.
The incidents also include a roughly $1 million loss at South Korean exchange ProBit and data breaches at Bithumb, another South Korean exchange.
The weak point can be an exchange’s withdrawal and transaction-signing controls, not the blockchain that records transfers.
Exchanges use online wallets and internal systems to approve and sign transactions, and attackers who gain the right access may be able to move assets through apparently valid transactions.
A secure blockchain does not guarantee a secure exchange, because it checks that a transaction has a valid signature, not whether the exchange’s owner intended it.
Investigators still need to establish which access or approval steps were compromised in the Binance case.
Binance said an attack caused an estimated $6.3 billion in losses, highlighting risks in cryptocurrency exchange security.
The blockchain itself may remain secure while attackers exploit an exchange’s systems for withdrawals or transaction approvals.
Analysts said the Binance attack was attributed to North Korea by TRM Labs and Chainalysis.
Binance said it had set aside more than $6.3 billion to cover losses, while other companies froze $3 billion of the stolen funds.
South Korean exchanges also reported incidents, including a hot-wallet withdrawal at ProBit and a data breach at Bithumb.
- Who
- Binance, the world’s largest cryptocurrency exchange, was attacked. TRM Labs and Chainalysis attributed the attack to North Korea.
- What
- An estimated $6.3 billion in assets was stolen. The incident highlighted how exchange security gaps can expose cryptocurrency even when the blockchain is functioning normally.
- When
- Binance said the attack occurred on Thursday; Yonhap reported it as taking place on the 29th of the previous month.
- Where
- Binance’s systems were targeted. The articles also describe incidents at South Korean exchanges.
- Why
- The precise breach method is still under investigation. The reports say attackers may exploit exchange systems and withdrawal or signing permissions without breaking the blockchain itself.
This story does not have two clearly opposing sides.
North Korean hackers stole $1.5 billion from the exchange Bybit, according to Business Standard.
South Korean exchange ProBit detected unusual withdrawals from a hot wallet and reported losses of about 100 million won.
An unauthorised person accessed Bithumb’s internal mobile groupware system, leading to a leak of customer and employee information.
Binance reported an attack with estimated losses of about $6.3 billion, according to Yonhap.
- Binance loss estimate
- $6.3 billion
- Frozen funds
- $3 billion
- Funds moved beyond issuers’ reach
- $2.4 billion
- ProBit reported loss
- About 100 million won
- Bithumb customer information exposed
- 6,444 customers’ records, according to the company
- Bithumb employee information exposed
- 715 employees’ records
2 sources
What people are saying
A.I. is undoubtedly turbocharging the ability of hackers to find and exploit subtle flaws in various parts of the crypto ecosystem
The key is that an attacker must secure a means to carry out the movement of assets they want
The blockchain verifies only whether a transaction was created with a valid signature, so if an attacker steals an exchange’s private key or approval authority, the transaction is recognized as legitimate and confirmed