233 million XRP transferred in 4 minutes—the harshest line in Binance’s report was: “This should not have happened”!
Binance’s investigation report on the October 30 security incident!
Binance has published its investigation report on the October 30 incident. The most gut-wrenching line wasn’t the amount lost, but the words: “This should not have happened.”
The chain of events actually began back in June. A member of a wallet development team downloaded a tampered tool from an ad; the malicious version appeared above the legitimate one in search results. The platform caught it, replaced the device, and changed the password, but the person’s access wasn’t revoked. In September, a second engineer downloaded a malicious code repository after a fake job interview—which even included a video call with the CEO of a fictional company. On October 20, attackers used an internal AI tool to gain access to two wallet development machines. On October 29, they transferred 233.46 million XRP from five hot wallets in four minutes, using 50 signed transactions.
What really sent a chill down my spine was the timeline: nearly four hours passed between the first and last unauthorized transfers. During that time, around $2.85 billion was frozen, but the process for revoking authorization had been improvised on the spot—and it was a step too slow.
Afterward, Binance said it had recovered around 95% of the assets. The remaining 5% consists of illiquid tokens, and it is still trying to source them over the counter. The numbers also gave it some credit: net outflows exceeded $7 billion on Monday, followed by net inflows of $2.3 billion over the next 24 hours, with hourly deposits once again exceeding withdrawals. This year, it has stopped 57 North Korea-linked attacks. The FBI also attributed this incident to North Korea, yet in the end, it was a hiring process that brought the exchange down.
My take is that you can’t pin this whole mess on the hackers. Exchanges have always relied on deep pockets, plenty of cold wallets, and a fast response—but this time, none of those three defenses failed because of technology. They failed because of process: people’s access privileges, poisoned ad placements, and the boundaries around the use of internal AI tools. Plugging a $6.3 billion hole takes money; making up for those four hours of response time takes an organizational overhaul.
Which side are you on: after something like this, should exchanges keep using profits and insurance funds as a backstop to earn trust, or should users simply keep their large holdings in their own wallets?
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