Binance’s Recovery of Stolen Cryptos Shows Digital Assets Are Not a Promised Land for Bad Actors

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An article from Fox Business announcement that Binance recovered some of the assets stolen in the recent Ronin hack. Just under $6 million worth of crypto has been recovered –less than one percent of total steering – but there is hope that larger segments will continue to be recovered over the next few days. US authorities linked the exploit to Lazarus – hackers outside of North Korea.

According to the article,

“Binance discovered the stolen assets by literally tracking the money through a series of movements made by the hackers. The Treasury has identified an Ethereum wallet address linked to the group. Binance traced stolen funds when they were moved from hackers’ wallet to Tornado Cash – a service that allows anonymous token transfers on the Ethereum blockchain. The funds were then transferred to the exchange.

The stolen assets were found in 86 different Binance accounts. What is remarkable in this case is that even after using Tornado Cash, Binance managed to trace the funds.

When we hear some politicians and bureaucrats talking, it’s almost as if Bitcoin and other cryptocurrencies are simply anonymizing the user. As this case study shows, these sound bites are more fear-based than reality-based.

The desire to cast Bitcoin and other cryptocurrencies as some sort of anonymous boogeyman who facilitates malfeasance is largely driven by fear. Fear that a decentralized financial system will become more popular and mainstream. Fear that those who have historically had a nearly vetoless hold over our financial system – that these people and institutions cannot exercise the same kind of control over cryptocurrencies.

This is why, in the coming fight against CBDCs, it is so important to insist that any digital currency issued by central banks comes with the privacy that citizens deserve.

Bitcoin transactions are tracked on an immutable blockchain that no one can interfere with or modify. Most of the issues we have seen over the past few years can be attributed to poor implementation of KYC (know your customer) and AML (anti-money laundering) procedures. – procedures which in many cases were required by law.

These procedures are necessary for a good reason. What the industry needs is for governments to come together and come up with a set of common sense guidelines for trading to implement – rules that protect the public while freeing crypto-takers to do what they do best – innovate.

Once governments address the issues in their regulatory regime, exchanges will be better able to respond to the threats facing the industry. They will be forced to apply these regulations evenly, ensuring industry safety for those who wish to participate.

This latest cover illustrates that the technology itself is simply not the problem. Every exchange should start implementing a better technological apparatus, supplemented by continuous security audits. In conjunction with government oversight and better enforcement, this will limit the risks faced across the industry.

Richard Gardner is the CEO of Module. He has been a globally recognized subject matter expert for over two decades, offering intricate insights and analysis on cryptocurrency, cybersecurity, fintech, surveillance technology, blockchain technologies, and management best practices. general.

Feature image: Shutterstock/Sergey Nivens