Binance, the world’s largest cryptocurrency exchange, says it has absorbed the biggest theft in the industry’s history without leaving a single customer out of pocket. But founder Changpeng Zhao, known as CZ, is now warning that the next wave of attacks could be faster and harder to stop, and he blames artificial intelligence for lowering the barrier to entry.
What happened
The heist drained roughly $6.3 billion in digital assets from the exchange on October 29. FBI investigators traced the hack to North Korea’s cybercriminals, the same group behind many such attacks on the crypto industry, and President Donald Trump said his administration is investigating. One report said Pyongyang has rejected the US allegations.
Binance has since explained how the breach began. The company said hackers used a fraudulent job interview to compromise an employee’s computer, giving them access to an internal service, and that the incident involved a compromised laptop belonging to a DevOps engineer. The same account says the attackers then used the company’s AI tool to help execute unauthorized transactions.
Customers made whole
Binance moved quickly to calm users. It reopened withdrawals on Sunday after replacing about 95% of the stolen assets using company funds, including its Secure Asset Fund for Users, an emergency reserve. The company said users would not bear the financial impact and that it would cover all losses.
Zhao repeated that message this week. “The users did not suffer any loss,” he told Yahoo Finance, explaining that Binance itself had absorbed the financial impact. Co-chief executive Richard Teng has also said the exchange bears full responsibility.
Most users stayed
The key question was whether customers would flee. Early withdrawals were heavy but not catastrophic. Zhao said the initial $3.6 billion in outflows represented about 2% of Binance’s holdings, implying roughly $180 billion in assets. After the exchange reopened, he said “98% chose to stay,” and withdrawal volumes declined and began to stabilise.
Assets on the platform did fall. According to DeFiLlama, exchange assets declined from $144.90 billion before the hack to $128.87 billion. That is a meaningful drop, although well short of a run on the exchange.
Freezing the loot
Recovery efforts have involved other parts of the industry. Zhao said Tether, Circle and law enforcement agencies helped freeze stolen funds. Stablecoin issuers can block tokens linked to illicit activity, which makes them a useful tool for investigators, though the extent of the recovery has not been fully disclosed.
“There’s no 100% security”
Zhao, who stepped down as chief executive in 2023, was candid about the lessons. He said a breach of this size had seemed unlikely, but that “there’s no 100% security,” particularly for a crypto platform.
His bigger warning concerned artificial intelligence. He said AI could unleash more cyberattacks against exchanges and banks, and that hackers were gaining access to AI capabilities faster than financial institutions could deploy them to defend themselves. He did not offer evidence that AI played a role in this particular attack, and investigators found no evidence that AI agents laundered the stolen funds. He also argued that AI could eventually strengthen security.
Lessons beyond crypto
The way the attack began should concern every company. A fake job interview needed no software flaw. It exploited human trust and a single employee’s device. Security experts have warned for years that recruitment lures are a favoured technique for state-backed hackers, because staff often download files or tools during interviews and assessments.
The reported use of an internal AI tool adds another layer. As companies give AI systems more access to internal services, those systems can become part of the attack surface if an intruder gains a foothold. Firms will need to decide how much authority to hand to automated tools, and how to monitor them.
What comes next
The investigation is continuing, and regulators will watch how Binance’s reserves hold up and whether further funds are recovered. For users, the episode is a reminder that even a company able to replace $6 billion can be breached. For the industry, it is a test of whether security practices can keep pace with attackers who are increasingly well-resourced and well-equipped.
