Hong Kong/New Delhi
CNN
—
The crypto industry cannot rest this year.
Binance, the world’s largest cryptocurrency exchange, is investigating a hack affecting multiple crypto tokens on Friday. According to its founder and CEO Changpeng Zhao, the private keys used to encrypt or decrypt data have been hacked.
“The initial analysis is that the developer’s private key was stolen, and the hacker updated the smart contract to a more malicious contract,” Zhao said. Say On Twitter, it was added that Ankr and Hay tokens were affected.
CZ tweeted that Binance suspended withdrawals a few hours ago. He appeared to be referring to Ankr’s loyalty token aBNBc, which was the target of the hack, according to Binance. Hay is a stablecoin, a cryptocurrency pegged to another asset.
A “smart contract” is a term used to describe computer code that automatically executes all or part of an agreement. It is usually stored on a blockchain-based platform.
“A hacker managed to exploit a bug in aBNBc’s code that allowed them to mint 6 quadrillion tokens which were converted into BNB tokens [Binance’s own coin] And transfer it through Tornado Cash, a cryptocurrency mixer platform,” said Matt Hussey, who writes a cryptocurrency newsletter called Zero Knowledge.
“This is another example of vulnerabilities in many of the contracts that underpin protocols and exchanges in the crypto space,” he added.
In another tweet, Binance assured users that “this is not an attack against the company” and that its team is working hard to investigate.
Meanwhile, Ankr said Twitterwhich is “committed to compensating affected users.”
“Ankr’s team has assessed the damage, a maximum of 5 [million US dollars] worth BNB,” it said.
Binance did not immediately respond to a request for more information.
The apparent attack comes as the digital asset industry grapples with the financial contagion sparked by the collapse of cryptocurrency exchange FTX.
Blockchain analysis firm Chainalysis said in October that more than $3 billion In the first 10 months of this year, the encryption industry suffered 125 attacks, and 2022 is expected to be a record year for such attacks.