Binance hit by 6.3 billion dollar crypto theft

Get the latest now with Aisha Down. She joins us as a tech reporter for The Guardian. Aisha, thank you so much for joining us. First question, all of that money stolen in 20 minutes. How on earth did that happen? So details are still really slim. Binance has come forward with a statement and then a couple crypto analysis labs have added their views. It appears to be that a DevOps engineer laptop was compromised and it had a connection to a hot wallet. So where a cold wallet will store your cryptocurrency offline, a hot wallet is connected to the Internet and can. or the network and can make transactions. There were a few wallets compromised. The biggest one held $2.5 billion. It's just astonishing to think of all of that money. They're calling it the biggest heist ever, potentially. And I guess on the face of it, we might not even be aware of it just in terms of what kind of impact this will have on the average consumer or the average cryptocurrency user, just... What actually happens if you are a user of Binance right now? Do you even feel that kind of effect? Well, it's interesting, isn't it? So Binance, I think right now, has something like 160, 170 billion in assets. So 6 billion is significant, but it's the largest crypto exchange in the world. I think there's kind of a sense that they can cover it. They're frozen now. And so they're sort of... Two things happening on the, like, Twitter, kind of YouTube X space, right? Half the people are saying that, you know, this is a sign that crypto can't be trusted. And then there's a trend where people will be saying, like, buy the dip, especially the really hardcore crypto enthusiasts. I was just sort of watching a few on YouTube and they were saying, well, you know, now that Bitcoin is down, buy more Bitcoin. So we'll see. It's hard to know because, you know, a lot of this is now frozen. And so we can't see the full effects of how... How much, you know, the value of Bitcoin or the other currencies might go down. It's astonishing because I saw that Bitcoin was trading at a six week low. And I even said to myself, maybe this is the correct time to actually invest a little bit more. But Binance is now promising Binance is now promising its customers won't lose a penny. Can it actually guarantee that? I think it has like a it's a SAFU fund of a billion. But it seems confident that it can scrape together the rest. I have no idea from loans, from other assets. That's, but. But it's actually, I'm not sure. I think that previous, like the BitGet hack of a year ago, which until now was the largest, they were also able to cover that. So it seems at this point kind of reasonable that maybe they can. Let's talk about who the alleged perpetrators are. North Korea. It's quite this nebulous idea of the North Koreans accessing a hacked laptop and getting an employee to actually disclose all of this information. But if indeed North Korea is responsible, where does that money ultimately go? Well, I want to back up a little bit. So I'm a tech reporter, and I think for the past year, you know, a lot of us have been following these really kind of impressive North Korean scams. So using AI to become like a fake employee and then getting a job interview at a US IT company and then holding down that job, you know, through representing themselves via AI and then actually, you know, turning out to be North Korean hackers. There's been, you know, As a tech reporter, I've been hearing of that kind of, I think, since January. So it doesn't surprise me that this, you know, that the state-backed group or, you know, the alleged group, it's supposed to be traitor-traitors, although that's not confirmed, was able to do this and sort of had the motivation. It comes down to making money. It's a way to fund the state, as far as we understand. And it... I think in talking to people in this space of looking at elite state hacking groups, North Korea maybe doesn't have often quite the skill as Russia-backed state hacking groups, but especially with AI and other more recent tooling, can do really powerful heists and is often doing it to fund the state given the pressure of international sanctions. It's very interesting to just think, though, of the entire process of how this happened. And as you say, it's not such a unique occasion or occurrence for this to happen. Just if you are Binance right now, though, how do you get your customers back on side? How do you show them that, don't worry, this won't happen again, given such a large-scale security breach? You say, obviously, its assets are that much, over $170 billion, but $6 billion is still a massive amount of money. What do you think Binance is going to do from here? That I can't say. But, you know, in looking at how this happened, I think it raises serious questions for the crypto industry as a whole. So I was talking to a cybersecurity expert earlier today, and they pointed out that this was accomplished basically by hacking, as far as we know, one engineer's laptop. If you were going to go empty someone's account at a Swiss bank, you probably wouldn't find that concentration of assets. Maybe you would. And also, those banks have sort of years and years of built up compliance tooling and checks. And so I suppose if you looked like you were under threat and you even wanted to open your own bank, sorry, to empty your own bank account, you'd probably have to get the bank branch manager, several people to sign off on a transaction of that size. So the banking industry has these controls. Crypto, you know, we don't know how Binance works internally, but there's a good parallel in FTX, which imploded famously a few years ago and which turned out to not really to have mixed together, apparently, like its customers assets with that, you know, with its own assets, with kind of other assets that we're supposed to do, like high frequency and risky trading. Um, and finance, well, you know, there's no evidence that it's doing the same thing or anything like that set up. Um, I think this does raise a question. You know, this is one laptop. I think they've compromised as far as we know, one person and they were able to get this much. That's not. On the surface, like a lot of serious checks. Right. And so if this is becoming a more like serious pillar of the world's financial system, then you've got to wonder if people's assets are secure as they once were. Six billion dollars of one person's laptop. It just. Beggars belief. But we can say that $3 billion of that have been frozen and located. Binance says it is conducting a full security review. But as Aisha Down says, we don't really know the ins and outs of what goes on behind the scenes at Binance. Aisha Down, thank you so, so much for joining us here on France 24 as the Guardian's tech reporter. Absolutely fascinating what is happening there in the crypto world.