Binance investigates possible hack affecting a number of crypto tokens

Hong Kong/New Delhi
CNN Business

The crypto industry simply cannot take a break this year.

Binance, the world’s largest cryptocurrency exchange, is investigating a hacking incident that affected a number of crypto tokens on Friday. According to its founder and CEO Changpeng Zhao, a private key, used to encrypt or decrypt data, had been hacked.

“Initial analysis indicates that the developer’s private key was hacked and the hacker updated the smart contract to a more malicious one,” Zhao said. said on Twitter, adding that Ankr and Hay tokens were affected.

Binance suspended withdrawals a few hours ago, CZ tweeted. It appeared to refer to Ankr’s loyalty token, aBNBc, which was targeted by the hack, according to Binance. Hay is a stablecoin, a kind of cryptocurrency pegged to another asset.

“Smart contract” is a term used to describe computer code that automatically executes all or part of an agreement. It is usually stored on a blockchain-based platform.

“A hacker managed to exploit a vulnerability in the code of aBNBc which allowed them to mint 6 quadrillion tokens, which were converted into BNB tokens [Binance’s own coin] and transferred through the Tornado Cash crypto mixing platform,” said Matt Hussey, who writes a crypto newsletter called Zero Knowledge.

“This is another example of the vulnerability of many contracts that power protocols and exchanges in the crypto space,” he added.

In a separate tweet, Binance reassured its users that “this is not an attack” on the company, and that its team was working to investigate.

Ankr, meanwhile, said on Twitterthat it is “committed to compensating the users concerned”.

“The Ankr team assessed the damage and it’s max 5 [million US dollars] value of BNB,” he said.

Binance did not immediately respond to a request for further information.

The apparent attack comes at a time when the digital asset industry is grappling with financial contagion triggered by the fall of crypto exchange FTX.

Blockchain analytics firm Chainalysis said in October that more than $3 billion had been hacked by the crypto industry through 125 attacks in the first ten months of the year, and that 2022 was on track to be a peak year for such exploits.

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