Last Friday, Binance announced that approximately $570 million worth of cryptocurrency had been stolen by hackers from a blockchain “bridge” used in the BNB chain. Blockchain bridges—which are used to transfer cryptocurrencies between applications—have seen a recent uptick in hacking, with an estimated $2+ billion stolen just this year.
After the hack, Binance, which is the world’s largest crypto exchange, suspended its BNB Chain blockchain for a few hours, halting trading. Like many other large crypto exchanges, Binance makes it difficult for users to move their crypto to different blockchains, necessitating the use of the less secure blockchain bridges. According to Binance’s CEO, after recovery efforts, they were able to limit the losses to “less than $100 million.”
When asked how Binance planned to address the exploited weakness in the blockchain bridge, Binance’s CEO said “the code is written by a group of developers for the blockchain, which is what we call the community developers or core developers, and the nodes that maintain this network—there’s like 26 to 44 nodes depending on what you count—and they need to vote to do the upgrade themselves.” He mentioned some votes have already been taken to make changes related to the hack but provided no assurances that blockchain bridges can be wholly trusted or that any efforts have been taken to find a different and safer way for users to transfer their crypto between chains.
Revision Legal has represented crypto owners who had their crypto stolen in hacks and due to the negligence of third-party providers. And our attorneys are experts when it comes to data breaches and remedies. If you or someone you know has had their crypto stolen or compromised, give the attorneys at Revision Legal a call or drop them a line here.