In the latest in what seems like weekly high-profile crypto heists, hackers nearly stole $570 million from leading crypto exchange Binance. High-profile crypto hacks have run rampant throughout the sector, but this goes down as one of the biggest heists ever. According to Investopedia, the Binance hack would’ve been the third-largest cryptocurrency attack of all time. Only the Poly Network hack in August 2021 and the Ronin Network attack in March 2022 netted larger paydays. With that said, here’s everything you need to know about the recent Binance exchange hack.
Once again, hackers used a cross-chain bridge exploit in the Binance hack.
As with most of the recent crypto heists, thieves exploited a weakness in a cross-chain bridge. Blockchain bridge attacks have become the most common exploit to steal large amounts of cryptocurrency. For example, hackers used a bridge exploit in the Ronin Network hack, which resulted in $625 million lost. And in the Nomad bridge hack from August, thieves made off with $200 million.
Unfortunately, blockchain interoperability is an essential step in the world of cryptocurrency. Without bridges, investors can’t send their cryptocurrency from one blockchain to another, creating fiefdoms in the community. Though these attacks repeatedly prove to hackers, for now, bridges are like giant “steal crypto here” signs.
Binance was able to minimize the damage to about $100 million.
The thieves used a flaw in Binance’s bridge code to mint two million new, fraudulent tokens out of thin air. The total sum of which adds up to over half a billion dollars. Fortunately, Binance’s validators sprung into action and locked down the blockchain, minimizing the damage. The hackers could only siphon around $100 million in the new tokens created in the attack. If the Binance smart chain didn’t use a proof-of-stake consensus mechanism, the hackers would’ve stolen the full $570 million.
Binance CEO Changpeng Zhao appeared on CNBC’s Squawk Box to discuss the attack and how they’ll move forward.
