Binance, the world’s largest cryptocurrency exchange, is investigating a security breach estimated to have cost the company $6.3 billion. The company has not confirmed definitively that all funds were stolen, but said it is working with blockchain partners to track and freeze the affected assets. About $3 billion has already been located or frozen, while there is no update on the remaining $3.3 billion.
According to Binance, the incident may have started with a compromised laptop of a DevOps engineer. The attacker may have gained access to a service container and made unauthorized withdrawal requests. The exchange says it has found no evidence of private keys being leaked from wallets. Deposits and withdrawals have been temporarily suspended while investigations are conducted and the movement of assets is tracked.
The trail leads to TraderTraitor
US blockchain analysis firm TRM Labs has linked the attack to TraderTraitor, a hacking group that analysts say is linked to North Korea. TRM said an estimated $6.36 billion was moved from Binance wallets to 10 blockchains, with the majority of the funds transferred in about 20 minutes. The company described the link to the group as “highly likely.”
Chainalysis also believes TraderTraitor is likely behind the attack. Binance said it is working with law enforcement to identify the perpetrators. It has not been confirmed who is behind the breach until the investigation is complete.
The exchange promised to cover the losses
Binance co-founder Yi He said the company would cover “all losses from the hack“. Representatives of the exchange assured that user funds are protected. Tether has frozen assets worth nearly $1.57 billion related to the incident, and Circle - over $800 million.
The news immediately affected the crypto market. Bitcoin fell by more than 3% to a six-week low of $76,368, and ether fell by more than 3% to $2,178. If the extent of the damage is confirmed, the incident would rank as the largest cryptocurrency theft ever, according to TRM Labs, Chainalysis, and industry analysts.