A Danish industry panel on the podcast Ugens Kryptosnak says the hack that drained roughly $6.3 billion from Binance overnight on 30 October was caused by a compromised computer, not a weakness in Bitcoin, Ethereum or blockchain technology.
Binance is the world's largest crypto exchange, and an estimated $6.3 billion in bitcoin, ether and stablecoins disappeared from the platform in under an hour overnight on 30 October. The scale of the hack, the suspected North Korean link and Binance's own response have already been covered in separate articles on Kaupr. On the podcast Ugens Kryptosnak, hosts Karina Rothoff Brix (Firi) and Jesper Munk (Dansk Krypto Nyt) instead used the episode to make a point they feel has been lost in much of the coverage: there is a difference between a company being hacked and the blockchain itself being hacked.
According to Rothoff Brix and Munk, the attack stemmed from a computer belonging to a Binance developer being compromised. That in turn gave access to the company's development environment, where keys could be reprogrammed so that funds were moved to the attacker's own addresses. Bitcoin and Ethereum are decentralised, immutable networks: a transaction cannot be reversed or halted by any central authority. What an exchange or analytics firm can do instead is flag the addresses the funds land on, so other players refuse to convert them into dollars.
– The blockchain hasn't been hacked. It's about a person having given access to something malicious inside the systems, and that can happen in crypto just as in plenty of other industries, says Karina Rothoff Brix of Firi.
Roughly half of the $6.3 billion was quickly frozen, partly because Tether and Circle halted the relevant stablecoin addresses. Binance has also said no customers will lose money, since the company's own Safu fund and its own capital cover the loss. According to the panel, rival Coinbase was among the players that helped trace the funds further. The market reaction was relatively mild: bitcoin fell 4-5 percent, most other coins 6-7 percent, while some fell 14-20 percent. Binance's own token, BNB, fell around 5 percent — only marginally more than the rest of the market. The panel notes that a similar incident a few years ago would likely have triggered far sharper swings, and argues that the fast, transparent handling — combined with hacks having become a more normalised part of the industry's everyday reality — is a key reason the fallout was contained this time.
Binance does not hold a MiCA licence in the EU/EEA, meaning no European regulator has reviewed the company's internal security systems. The panel points to this as an argument for stricter regulation of exchanges serving European customers. As a contrast, they point to Firi's own MiCA licence, which has required the company to document its security procedures and submit to ongoing supervision.
– At Firi there are far more layers of security and internal systems to get through. It would never have been possible to gain access through just one computer or one person there, says Rothoff Brix.
Sources: Ugens Kryptosnak, Firi
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