Binance’s $6 billion hack is a dark day for all in crypto

Welcome back to Asia Tech Review, your curated digest to keep up to date with tech news across Asia.

Today we look at the record Binance hack that saw more than $6 billion in Bitcoin, Ethereum and other assets stolen by what is thought to be a North Korean hacking group. We look at why exchanges aren’t the industry spokespeople the crypto industry wants or needs. Don’t miss our weekend story on Thailand’s struggling AI initiative.

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You’ll have to excuse our departure from the usual focus on AI and other tech today. Crypto took centre stage of the news last week after the news that exchange Binance was hacked for an incredible $6.3 billion.

This is the largest hack in the history of crypto, and Binance is a Chinese company (despite what it may say) so of course we’ll dive in.

The attackers were able to access a Binance hot wallet, a wallet that’s used for activities like liquidity, customer deposits or withdrawals. They then made transactions to drain its balance across 10 different blockchains, despite the Binance wallet requiring 50 different security authorisations.

The tokens stolen included:

Binance is still investigating what happened, but its early assessment suggested a laptop belonging to a devops engineer was compromised. The company then said over the weekend that it “uncovered additional points of breach” which it will give further details on in the coming days. It claimed that private wallet keys did not leak.

Blockchain intelligence firm TRM Labs has already claimed TraderTraitor, which it describes as North Korea’s “premier hacking unit,” is responsible. The group is best known for carrying out the $1.5 billion hack on Bybit, another high profile crypto exchange, back in February 2025. That was a record attack at the time, but this Binance heist has surpassed it by some margin.

Since blockchain transactions are public to see, TRM Labs has pieced together exactly what happened from on-chain activity. It speculated that the breach impacted Binance’s signing system, its security steps to authenticate transactions, which meant it bypassed the 50 signatures, similar to the Bybit attack.

The incident couldn’t be worse for Binance, which is still trying to clean its reputation after it pleaded guilty in the US to money laundering offenses in 2023.

It received record fines of more than $4 billion, while CEO Changpeng Zhao (CZ) agreed to step down. He ultimately served four months in prison, before being pardoned by President Trump last year. In his stead, Richard Teng, a former MAS exec who had been Chief Regulatory Officer of the Singapore Exchange (SGX), became co-CEO with CZ’s co-founder He Yi. Teng has led an effort to make Binance more compliant, striking deals in markets like the Philippines and reportedly soon Malaysia, where Binance had been blocked.

That effort to seem like a grown up will be impacted by this huge incident.

In moments like this, also, we are reminded just how decentralised crypto is. That’s to say, its rise to prominence came from the concept that it was a different paradigm to traditional finance. Users truly own their assets and the markets trade 24/7.

Except it doesn’t work that way. A number of companies stepped up to freeze assets and reverse transactions impacting the stolen funds. Around $3 billion, or nearly half of the affected assets, were frozen, according to Binance. While that’s good for the company and it impacts the attacker, from an ideological perspective, it is proof shows centralisation. The idea that it is an alternative financial system hasn’t played out.

Binance, and other exchanges, are so often the entities that produce the worst news for the industry. Media coverage will have you believe that Binance is hugely popular and celebrated among people in the space and, whilst that’s true to a large extent in terms of its number of supporters, many influential people don’t like the company. It’s seen as greedy, arrogant and lax. Nobody asked for these organisations to represent the industry, and yet they so often do, particularly when it comes to the bad news cycles.

Following Binance’s last major hack in 2019, then a mere $40 million in Bitcoin, CZ suggested the Bitcoin blockchain would be ‘rolled back’ to reverse the losses. That is an absurd suggestion. Doing so would reverse all subsequent transactions that took place after Binance was hacked. It would set a dangerous precedent for the future. All because of Binance’s shortcomings. It didn’t happen but it showed the arrogance and greed of exchange businesses.

The fact that Binance quickly came out to say it would cover all lost funds (more than $6 billion) shows just how much money the company makes. Added to those US fines, and the company has had more than $10 billion removed from its funds in the last few years. Few businesses could withstand a hit like that, but exchanges make so much money and yet still are so fallible at best, or incompetent at worst.

Their business models are based around charging wide spreads for customer transactions and, when it comes to listing new tokens, demanding millions of dollars in tokens to make new assets available. Despite making billions in profits, their security systems lack sophistication and many have brazenly committed criminal activities.

The technology itself remains the big story, and that’s why banks, payment companies and others are adopting stablecoins for fast and cheap international payments, always-on trading strategies, tokenised stocks and other features that can genuinely improve traditional finance. There’s a lot more to delve into here.

Everyone loses in a huge hack like this, which reinforces the issues and inefficiencies of the crypto industry at large.

Additional reading: The New York Times has an inside look on how the hack went down

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