On March 23, cryptocurrency network Binance fell victim to a mega-heist of $600 million in cryptocurrency. The blockchain network has since recovered a fraction of that money, while most of it still hasn't been unaccounted for.
How much crypto has Binance recovered from the hackers and will the network be able to recover more?
How the $600 million Binance mega-hack went down
Just over one month after the massive Binance crypto hack, the network is working to recover $600 million in crypto. The stolen assets were USD Coin tokens, which are a type of stablecoin whose value is pegged to USD fiat currency.
The Binance crypto attack is considered one of the largest in history, topped only by the Poly Network event in 2021 (amounting to $611 million) and the recent Ronin Network event in March (amounting to $625 million).
According to the U.S. Treasury Department, a North Korean hacking group called Lazarus is responsible for the event. According to Reuters, Lazarus has reportedly been at the helm of major hacks over the years, including those against pharmaceutical companies during the early days of the COVID-19 pandemic.
Binance has recovered a fraction of the total crypto lost in the hack.
Binance has recovered a reported $5.8 million so far. This is less than 1 percent of the total $600 million in crypto that hackers stole. The network reportedly found the stolen assets because the hackers added them back into the platform to keep using the tokens. While the hackers attempted to disguise the tokens through various techniques, Binance was able to spot the assets.
Binance founder and CEO Changpeng Zhao wrote on Twitter about the recovery and stated, “The DPRK hacking group started to move their Axie Infinity stolen funds today. Part of it made to Binance, spread across over 86 accounts. $5.8M has been recovered.”
Recovering stolen assets is difficult for Binance and other platforms.
Recovering stolen crypto is much different than recovering laundered fiat currency. Blockchain technology is inherently traceable, even if the people behind the blockchain-based identities are anonymous. Exchange hacks can impact individual cryptocurrency users, which is why cybersecurity threats like this are such a concern.
In events as large as the $600 million Binance heist, the federal government gets involved. Together, the network and department (most likely the Treasury, as is the case with Binance) track blockchain behavior to find movement of stolen assets.
Will Binance recover the remaining crypto?
Binance still has to recover more than 99 percent of the crypto stolen during the March event. It’s uncertain whether that will happen. However, Binance has already refunded many users for various hacks and prioritizes its customer base through funding initiatives.
For example, Binance helped to raise $150 million in funding for the Axie Infinity play-to-earn game creator Sky Mavis. The company will use those funds to reimburse players whose assets were stripped from the Binance network. Other investors in the round included Animoca Brands, a16z (the crypto arm of venture firm Andreessen Horowitz), Dialectic, and Paradigm.