How the Binance attack took place according to CZ

08 May, 2019
by Will Heasman
How the Binance attack took place according to CZ

Today the crypto community witnessed the fallout from a hack on the worlds largest cryptocurrency exchange, Binance; as more information continues to become available, further light it shed on the incident, now the Binance CEO Changpeng 'CZ' Zhao has taken to Twitter to explain a little more about how the Binance attack took place...

In an AMA posted earlier today, Binance boss CZ addressed the security breach, and informed listeners of the techniques hackers use in order to gain access to a Binance hot wallet containing 7000 BTC, amounting to 2% of the exchanges total BTC holdings

CZ reiterated the Binance blog post issued earlier today, which detailed how attackers managed to abscond with a large number of user API keys, and 2-factor verification codes using a variety of techniques, including phishing, the use of viruses, and “other attacks,” which the exchange is still trying to identify.

However, CZ goes on to elaborate upon this, staying that the attackers used both “external and internal methods” in order to phish for access to user accounts.

CZ also noted the clandestine and organized nature of the hackers, noting that the “advanced” attackers waited for “high net worth accounts’ before making a move:

“The hackers are very patient … they don’t move as soon as they have one account, they wait for when they have a very large number of accounts … very high net worth accounts.”

CZ also divulges that the security of the exchange measures wasn’t able to detect the attack in order to stop the withdrawal, which ended up costing the exchange the hefty sum of 7070 BTC, or approximately $40 million at current prices.

Despite the losses incurred, thanks to the foresight of CZ and the binance exchange, the SAFU fund which was set up last year in order to ensure against such attacks, will fully cover the exchanges losses.

CZ also suggested that users change their API keys for traders using API trading, as well as resetting 2-Factor authentication security measure.   

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