What a $9.2bn crypto hack reveals about a changing industry

详细摘要

Suspected North Korean hackers stole billions in cryptocurrency from Binance, the world's largest digital assets trading platform. The industry showed its maturation by largely shrugging it off.

In the largest cryptocurrency heist ever, hackers stole US$6.3billion (A$9.2 billion) last month from cryptocurrency exchange Binance, with North Korea suspected to be responsible. Binance responded quickly, freezing about half of the funds and suspending withdrawals, and has since covered all customer losses.

This swift action saved its user base and kept losses in the broader crypto market relatively minor. However, the broader industry’s response raises more questions than it answers about crypto’s main tenet of “decentralisation”.

Unlike a traditional currency or security, many cryptocurrencies like Bitcoin are not controlled by an issuing government or central bank, but rather by an underlying cryptographic code and algorithms. Many early adopters were drawn to this decentralised element. But since the industry has grown to more than US$2 trillion, it finds itself caught between its first principles and the demands of a maturing market.

“Crypto was originally designed to bypass all of the intermediaries and the central banks and that sort of stuff, so you’ve got to take the good with the bad,” Jeremy Britton of crypto trading fund, Boston Trading, told Crikey.

“Everybody wants the Wall Street money to come in, but institutional money brings institutional problems and institutional behaviour.”

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The FBI blamed the October 29 hack on a North Korean group known as TraderTraitor, a claim North Korea denies. The FBI had also pinned TraderTraitor as responsible for last year’s high-profile US$1.5 billion hack of another crypto exchange, ByBit.

Immediately after the Binance heist, the hackers split the stolen billions over thousands of digital wallets. This was done using “cross-chain swap” services, which effectively helped launder the digital assets.

One service, THORchain, processed more than US$46 million in stolen funds within 72 hours of the heist, and continued processing after FBI requests to stop.

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