FBI Accuses North Korea of Major Binance Cryptocurrency Theft

FBI Accuses North Korea of Crypto Heist

The FBI has alleged that North Korea orchestrated a massive theft of over $6 billion in virtual assets from the cryptocurrency exchange Binance. The incident is deemed one of the largest publicly attributed cryptocurrency hacks to date.

The bureau’s cyber alert released Saturday indicates the attack occurred on or about October 29. Collaboration with the U.S. Secret Service and IRS Criminal Investigation led to observing the conversion of stolen assets, mainly into Ethereum. Authorities anticipate the funds transitioning through decentralized finance platforms and instant-swap services for broader laundering efforts.

Blocking Transactions Linked to TraderTraitor

Cryptocurrency companies, blockchain analytics firms, decentralized finance services, exchange operators, and node operators are advised by the FBI to block transactions tied to addresses allegedly controlled by North Korean actors.

The alert highlights an ongoing campaign known as “TraderTraitor,” which has previously been associated with North Korea’s high-value cryptocurrency thefts. These actions aim to generate revenue for the isolated regime and accentuate concerns over North Korea’s use of cybercrime to evade sanctions and obtain foreign currency. The stolen digital assets reportedly fund the country’s weapons and military programs.

Investigations and Statements from Binance

Binance, the world’s largest cryptocurrency exchange by trading volume, has responded following revelations of compromised systems potentially linked to a software engineer’s laptop. This access enabled hackers to authorize withdrawals.

Previously, in 2022, Binance experienced another substantial crypto heist when a hacker artificially created 2 million BNB tokens, valuing around $570 million. Despite intervention, attackers managed to steal over $100 million.

Details of the Attack

TRM Labs, a blockchain company, states that the attack preparation spanned approximately 36 hours. During this period, operators initiated “three small withdrawals from Tornado Cash,” a service obscuring crypto sources.

The subsequent attack targeted two wallets and tested code on a third wallet before transferring funds to hacker accounts. Following this, within just four minutes, five Binance hot wallets sent 233.46 million XRP to hacker addresses, with each wallet retaining only a minimum balance.

Additional Binance wallets on Optimism and Solana were hit shortly after, followed by a Binance Bitcoin hot wallet taken over at 8:20 p.m. Hackers acquired 18,270 BTC, splitting them into smaller pieces using a “peel chain,” a technique to obscure funds’ origin. Attackers also extracted 612.7 million USDT and 46.4 million TRX from a Binance hot wallet on Tron.

Advice for Binance Users

Kathryn Westmore from UK Finance warns users about potential scams from fraudsters claiming to retrieve lost funds, which is unlikely. Although Binance asserted user funds are secure, the potential breach of personal data necessitates vigilance against unlawful use or sale of personal information.

Binance pledged to cover costs related to the hack.

For further information, contact Anthony Murray and Jennifer Radcliffe at Newsweek.