Latest Cryptocurrency Breach Affects Binance Exchange

A hack of the Binance Smart Chain blockchain network may have cost the largest cryptocurrency exchange in the world, Binance, over $100 million. “The problem is now under control. Your money is secure. We regret the inconvenience and will keep you updated as necessary, “CEO Changpeng Zhao made the statement in a tweet on October 7, 2022.

The Issue

The company discovered an exploit between two blockchains, a technique of digital theft that has recently been used in at least one other significant hack, according to a Reddit post by Binance discussing the incident. As a result, the company temporarily suspended transactions and funds transfers.

“The issue has now been resolved. Your funds are safe. CEO Changpeng Zhao tweeted, “We apologize for the inconvenience and will keep you updated as needed.”

The BSC Token Hub, a cross-chain bridge that enables the transfer of both digital assets and data between blockchains, is where the problem occurred, according to Zhao.

According to Binance, $100 million and $110 million were stolen.

In a blog post that was published on Friday, Binance stated that it was trying to secure any vulnerable places.

The post stated, “a new on-chain governance mechanism would be created on the BNB Chain to combat and defend against potential future attacks.”

Further decentralization will lead to a rise in community validators, according to Binance. There are presently 26 active validators on its BNB Smart Chain.

Cryptocurrency

A cryptocurrency is a digital currency that works as a medium of exchange over a network. It is not backed or managed by any central body, such as a bank or government. It is also referred to as crypto. It is a decentralized technique of verifying that the parties to a transaction have the funds they claim to have, doing away with the need for conventional intermediaries like banks when money is exchanged between two businesses.

Bitcoin was the first decentralized cryptocurrency to be made accessible as open-source software in 2009. As of March 2022, more than 9,000 other cryptocurrencies were on the market, more than 70 of which had a market capitalization of at least $1 billion.

Many humanitarian organizations, including UNICEF, have begun accepting cryptocurrency donations. According to UNICEF Innovation’s chief adviser, Christopher Fabian, the children’s fund will adhere to donor rules, so anyone making an online donation must pass checks before depositing money.

Following the Russian invasion of Ukraine in 2022, the Ukrainian government raised more than US$10,000,000 in aid through bitcoin.

Customers can swap cryptocurrencies for other assets like traditional fiat or digital currencies on cryptocurrency exchanges.

Cryptocurrency markets do not guarantee that an investor buys or sells at the best price. Due to this, many investors make money by using arbitrage to ascertain the price difference between different markets.

Binance

Binance is the largest cryptocurrency exchange in the world in terms of the daily trading volume. Binance was founded in 2017 and registered in the Cayman Islands.

Binance was started by Changpeng Zhao, a developer who had previously created high-frequency trading software. Binance was founded in China but later moved its offices there due to the nation’s tightening cryptocurrency regulations.

Investigations into Binance were started in 2021 by the US Department of Justice and Internal Revenue Service due to allegations that the company had committed a tax fraud and money laundering. The Financial Conduct Authority of the UK has ordered Binance to stop all regulated operations in the UK by June 2021.

Binance disclosed client information with the Russian authorities in 2021, including names and addresses.

Binance Response

Last year, Binance declared that it was past time for international regulators to put controls into place for the markets for cryptocurrencies. According to the company, crypto platforms must protect consumers, implement measures to stop financial crimes and work with politicians and authorities to develop standards for user safety.

Binance is the most recent cryptocurrency company to be hacked. According to media sources, the nomad was agreed upon in August, and the cost was close to $200 million. The cross-chain bridge, intended to facilitate the transfer of goods and data, was also abused in the Nomad assault. Harmony suffered a loss of about $100 million in a breach in June.

Gloria Flynt

I am a Research Content Specialist in Update.co.ke. I have been working with update.co.ke for over 6 months. Update.co.ke is a digital platform that provides news and analysis on business, economy, technology and entrepreneurship in worldwide. I love reading and writing about anything that has to do with science, technology, and developments in the digital world.

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