Binance Shuts Down Binance Smart Chain After Massive Hack

Binance has asked validators to halt block production on the Binance Smart Chain after hackers exploited a vulnerability in the BSC Token Hub bridge to steal $586 million worth of assets.

According to PeckShield, although the attackers gained access to 2 million BNB coins ($586 million), they could only withdraw about $89.5 million to other networks. Of these funds, 58% were withdrawn to Ethereum, 33% to FantomFDN and 4.5% to in Arbitrum. Also, part of the stolen funds was transferred to Polygon, Avalanche and Optimism.

The rest of the tokens and coins remained frozen in Binance Smart Chain (BSC) and, most likely, the exchange will be able to return them. According to Binance CEO Changpeng Zhao, the damage from the attack is estimated at $100 million.

An exploit on a cross-chain bridge, BSC Token Hub, resulted in extra BNB. We have asked all validators to temporarily suspend BSC. The issue is contained now. Your funds are safe. We apologize for the inconvenience and will provide further updates accordingly.

— CZ Binance (@cz_binance) October 6, 2022

So far, there is no detailed analysis of the incident. But, apparently, a vulnerability was discovered in the algorithm for checking the proof of transactions of the BSC Token Hub bridge, which allowed the attacker to issue new tokens using simultaneous transactions. Fortunately, he managed to carry out only two such transactions, otherwise the damage could have been more significant. Binance representatives thanked the community for the quick response and support.

Note that now hackers get the most profit when hacking inter-network bridges. During the first half of this year, hackers removed over $2 billion of assets from inter-network bridges. The largest was the hacking of the Ronin network bridge, when the attackers removed $624 million in ETH and USDC tokens.