Break-in on BNB Chain. They stole $ 544 million, but will pay out a small fraction

Once again, it turned out that the bridges connecting individual blockchain networks are the weakest links in the token exchange infrastructure. Hackers broke into BSC Token Hub. It is estimated that they managed to steal $ 544 million, but only a fraction of them managed to cash in. The BNB Chain team suspended the network's operations and blocked the money. How did it come about?

Break-in and massive theft of cryptocurrencies is no longer just an industry rumor. Even the spokesman has already confirmed them Binancewhich has just issued an official statement. He posted them on Reddit. We can read in it, among others:

"Initial estimates of BSC withdrawals range from $ 100 million to $ 110 million, but thanks to community efforts and our internal and external security partners, about $ 7 million has already been frozen."

The situation is dynamic, as the initial amount was USD 544 million. However, it should be remembered that the mere acquisition of cryptocurrencies does not always mean that you can immediately use them for your own purposes. That is why the theft itself is often just the beginning of a complicated hacking operation. The sooner you can break it, the less tokens will go to the thieves.

How BSC Token Hub works

The BSC Token Hub is the internal bridge between the chains for the BNB Chain Ecosystem. Thanks to it, tokens can be transferred between the governance blockchain BNB Beacon Chain and the BNB Smart Chain (BSC) consensus layer. Chain bridges are one of the newest branches blockchain. This makes it one of the most vulnerable to attacks, like any innovative solution. It is still being developed, especially in the field of security, but - as you can see - even among the best in this industry, there is still a lot to do.

Founder Cryptocurrency exchanges Binance, Changpeng Zhao, even admitted that the hackers took advantage of the bug, which "Resulted in the emergence of additional BNB". That is why the validators approving all transactions on the network were immediately asked to suspend the operation of the BSC. Time was crucial.

Hackers duplicated BNB tokens thanks to investment

The solution was the so-called hard fork, introduced by the BNB Chain team. This is the fastest and easiest form of blocking thieves' accounts, as well as freezing asset transfers between BNB Beacon Chain and BNB Smart Chain.

This allowed most of the assets to be located quickly. Representatives of the cryptocurrency exchange Binance also argue that the funds accumulated on the cryptocurrency exchange are safe. Indeed, no one was missing. The clients' money is where it was. It turned out that the vulnerability in the BSC Token Hub system was used to duplicate tokens, which allowed for their double spending. This was confirmed by an expert of the Paradigm company. 

As a result, USD 544 million was sent to the hackers' address. But 80% of these funds, or approximately USD 433 million, are in the BNB Chain network and they cannot be withdrawn, exchanged for another, pledged, borrowed etc.

Interestingly, this was not a simple theft-only attack. First, you had to invest a lot. Analytical company slowmist indicates that the thieves used tokens deposited on the cryptocurrency exchange for this action changenow. It was thanks to its use that they deposited 900 BNB in ​​the Venus Protocol loan protocol. Then they opened double-hedged positions worth $ 000 million. However, they will have to pay back the loan, because a smart contract watches over it. If they do not pay it back, the security will be used and it will be gradually liquidated. Everything indicates that most of the amount will stay in the system, but even if they have a few million USD left, they probably won't complain anyway ...