The popular cryptocurrency exchange Binance was hit by hackers on Oct. 29. The company confirmed that attackers gained access to its servers and stole $6.3 billion, with analysts calling it one of the biggest thefts in cryptocurrency history.
While investigating the breach, the FBI confirmed that a known group of North Korean hackers who use the name “TradeTraitor” was behind the hack. Binance initially said hackers likely used an employee’s laptop to gain access to their servers. Now, the company added that hackers likely gained access to its systems in June, and then, using a recruitment scam that involved fake job interviews in September, gained a further foothold that let them steal billions in October.
The company temporarily paused all withdrawals at the end of October and resumed them on Nov. 1.
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The company says it “will cover all losses” for affected traders using its secured reserves and funds. As of Nov. 4, the company has “now replenished approximately 98% of the impacted amount,” it said in an X post. The last bit is expected to take longer to acquire. That’s because of the $6.34 billion in losses. Binance is holding $5 billion in exact token assets, with plans to purchase the rest through other market channels.
“We are doing this to match the format of the remaining token assets and address any asset shortfalls,” a Binance spokesperson told CNET on Oct. 30. So if you lost money in the form of bitcoin, you would ideally be reimbursed in bitcoin, not another cryptocurrency.
Crypto prices fell across the board upon the news of the Binance breach. Cryptocurrency isn’t regulated like other stock markets or banks. Crypto markets are constantly open, and traders “mine” currency using complex computations that use a lot of energy. (If that sounds familiar, it’s because a lot of crypto operations were the blueprint for AI data centers.) Binance is not insured by the Federal Deposit Insurance Corporation, the government agency that protects your bank deposits (up to a certain amount) if your bank fails.
Cybersecurity breaches are increasingly escalating, thanks to AI powering both defenders and attackers. Polymarket, another crypto trading platform, temporarily paused trading on Oct. 29 due to a third-party vendor issue, which was also referred to law enforcement, according to the company. But the Binance hack may be the “largest hack in history,” according to blockchain research firm TRM.
