Reuters accuses Binance of helping hackers withdraw more than $ 2 billion

Reuters accuses Binance of helping hackers withdraw more than $ 2 billion

According to a Reuters investigation, the world’s largest cryptocurrency exchange, Binance, may have served as a conduit for laundering at least $ 2.35 billion in illegal funds over the past five years (we are waiting for the exchange’s official response).

In September 2020, a North Korean group of hackers known as Lazarus hacked into a small Slovak cryptocurrency exchange and stole virtual currency worth about $ 5.4 million. It was one of a series of cyberattacks by Lazarus that Washington said were aimed at financing North Korea’s nuclear program.

A few hours later, the hackers opened at least two dozen anonymous accounts on Binance, the world’s largest cryptocurrency exchange, which allowed them to convert the stolen funds and hide the money trail, according to correspondence between the Slovak national police and Binance.

In just nine minutes, using only encrypted email addresses as identification, the Lazarus hackers created Binance accounts and exchanged the cryptocurrency stolen from Eterbase (the same exchange mentioned above). According to a Reuters investigation, the lost Eterbase money is part of a flow of illicit funds that passed through Binance from 2017 to 2021.

During this period, Binance processed transactions totaling at least $ 2.35 billion related to hacking, investment fraud, and drug trafficking, Reuters calculated based on a review of court records, law enforcement statements, and blockchain data collected for the news agency by two blockchain analysis companies.

In addition, Chainalysis, a cryptocurrency researcher hired by US government agencies to track illicit flows, concluded in a 2020 report that Binance received criminal funds totaling $ 770 million in 2019 alone, more than any other crypto exchange. Binance CEO Changpeng Zhao accused Chainalysis on Twitter of «poor business etiquette.»

Binance refused to agree on an interview with Changpeng Zhao to comment on the agency’s material. Responding to written questions, Public Relations Director Patrick Hillmann said that Binance does not believe the Reuters investigation is accurate. He did not respond to requests for Binance’s own data on the cases mentioned in the article. He also said that Binance is working to build «the most serious cyber forensics team on the planet» and is committed to «further improving its ability to detect illegal cryptocurrency activity on the platform.»