Ian Cheng — November 10, 2026
In what was the largest cryptocurrency heist ever recorded, hackers stole $6.36 billion from Binance, the world’s largest cryptocurrency exchange, in over just 20 minutes on the evening of October 29th. The swiftness and sophistication of this attack, among other factors, prompted many researchers and the Federal Bureau of Investigation (FBI) to tie it to North Korean military hacking unit TraderTraitor. The theft is a complicated issue that can be much better understood through breaking down the following statements.
TRM Labs: “An attacker moved approximately $6.36 billion out of Binance wallets on ten blockchains.”
What’s a blockchain?
It’s a decentralized database that tracks crypto transactions. Each crypto transaction is recorded as a “block” of data, which includes critical information such as the transaction amount and timestamp. Each block is linked to the previous block and the block after it through a cryptographic hash, creating a chain.
This chain allows transactions to be validated through a consensus mechanism. For example, if someone tries to alter the transaction amount within Block 2’s data, Block 2’s “hash” will change instantly. It will no longer match up with the “previous hash” noted in Block 3. In turn, previous fraud can be detected, giving it an advantage over centralized networks, which rely on a single authority.
However, this security mechanism is not autonomous. It is run by a global network of independent computers (nodes) who have access to the blockchain.
Wait, on ten blockchains?
Hackers were able to steal money from ten of these networks, including $3.8 billion from Ethereum and $1.5 billion from Bitcoin. These networks are completely separate and independent of each other, for instance, they use different code rules and transaction-validation mechanisms. Sidestepping this obstacle by targeting Binance’s internal wallet structure was why the attack was deemed “highly sophisticated.”
Internal wallet structure? How did the theft actually happen?
The hackers spent months preparing for the heist.
- In September, someone posing as a project director ran fake job interviews with a Binance software engineer. On these calls, the engineer downloaded an “assignment” onto his computer. This assignment contained malicious code.
- On October 20th, the hackers used the compromised computer and an internal Binance AI tool to gain control over two other wallet engineers’ devices. There, they discovered a “deployment permission token.”
*In this context, wallets manage the private keys you use to sign for your transactions, similar to how a credit card is used in an actual wallet.
- This token gave the attackers power to deploy more malicious scripts to drain Binance’s funds on October 29th. They were able to do this thanks to a wallet engineer’s unique privileges.
Binance has rebuilt the wallet system and AI tool involved in the attack. Yet, since this process was separate from breaching blockchain data as a whole, researchers also say it’s “too early to determine whether there were any flaws with Binance’s security systems,” as per NPR.
CIO Africa: “Binance’s Bitcoin hot wallet sent out 18,270 BTC, worth about $1.47 billion.”
What’s a hot wallet?
It’s a type of crypto wallet that is immediately accessible. Like any other wallet, it contains private keys to authorize transactions, which are then validated via the blockchain’s consensus mechanism. The trade-off is that it is constantly connected to the Internet, making it vulnerable to attacks.
Notably, in the attack, hackers could only drain money from hot wallets. Therefore, crypto could use cold wallets, which keep their passkeys on a device not connected to the Internet, as an additional safety net. The disadvantage is speed, as withdrawal from cold wallets requires additional logistical steps, sometimes including manual approval.
What does this mean for geopolitics?
Since 2017, North Korea-linked hackers have stolen $12.8 billion in crypto. This shows how the country has turned to crypto heists as a way to support its troubled economy. Therefore, it could be a potential talking point in future Donald Trump-Kim Jong Un talks.
However, this prospect looks less likely after this event. On November 4th, Kim’s sister issued a statement saying that the FBI’s accusation of North Korea demonstrated the United States’ “hostile policy.” As long as that stood, there was “no need” for talks, but she did not rule out future dialogue. This reflects a dynamic that the Trump administration must carefully navigate: protecting the 70.4 million Americans who own some form of crypto while managing relations with a nuclear power.
Now, Binance has frozen around $2.85 billion of the stolen assets and as of November 3rd, replenished 98% of the affected crypto. The issue isn’t a short-term financial one: customers took a relatively small loss. Rather, it’s about how the crypto industry can bounce back and recover confidence.
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