CZ warns of more AI-driven hacks after Binance's $6.3 billion theft

Binance's founder says AI will fuel more attacks on exchanges and banks

Binance founder Changpeng "CZ" Zhao warned that artificial intelligence could lead to more cyberattacks on cryptocurrency exchanges and banks, in an interview with CoinDesk published three days after the Oct. 29 theft of $6.3 billion from the exchange. An exchange, such as Binance, is a platform where people buy and sell cryptocurrency.

"The industry needs to use AI to prevent AI hacks," Zhao said in the interview. "There's no other way." He said attackers are getting access to AI capabilities faster than financial institutions can deploy them for defense, and called for common security standards or an industry alliance. He said discussions are underway but no details have been agreed on yet.

Zhao no longer runs Binance. His warning is his own opinion, offered in an interview; he provided no evidence that AI played a role in the attack itself.

The warning in brief

• Zhao says AI could drive more attacks against crypto exchanges and banks, and urges firms to adopt AI-based defenses and shared security standards.
• The FBI attributed the $6.3 billion theft to North Korea's TraderTraitor hacking group; Zhao did not mention North Korea in the interview.
• Blockchain analytics firm Elliptic found the stolen funds were moved by automated scripts, with no sign an AI agent made decisions.
• Binance recorded $5.28 billion in net outflows over a 46-hour period ending Tuesday, and researchers estimated $2.85 billion of the stolen funds has been frozen or seized.
• Zhao expects more hacks in the short term but thinks stronger AI defenses could reduce losses over time.

What investigators actually found about the laundering

The evidence so far does not support AI involvement in moving the money. "Our assessment is that the laundering is automated, but nothing we have seen shows an AI agent making decisions," Elliptic co-founder Tom Robinson said. Laundering means moving stolen funds through many wallets to hide their origin.

That finding covers the movement of the stolen funds only, not how the hackers first broke into Binance. On the breach itself, neither Zhao nor the interview supplied evidence that AI was involved. The FBI's attribution to North Korea's TraderTraitor group stands as the reported cause.

Withdrawals during the 46 hours after the theft

Zhao said an initial $3.6 billion in customer withdrawals was about 2% of Binance's holdings, which implies roughly $180 billion in assets. He said he had expected withdrawals of 10% to 30%, or $18 billion to $54 billion on that basis. These are his estimates, not audited figures.

Binance CEO Richard Teng's figures showed $10.97 billion in withdrawals and $5.28 billion in net outflows over a separate 46-hour period ending Tuesday. Teng said hourly deposits had started to exceed withdrawals, though the exchange was still in net outflow across the full period.

On recovery of the stolen funds, Zhao said Tether, Circle and law enforcement helped freeze them, with the U.S. Secret Service assisting. Researchers estimated $2.85 billion has been frozen or seized.

Why this matters for exchanges and banks

Zhao framed the risk as reaching beyond crypto: "If a crypto exchange can be hacked, banks are in a worse position, in my opinion." His argument is that an attacker needs to find only one weakness, while a defender must find and fix all of them, and that AI lowers the cost of complex attacks. He also said more hacks are likely in the near term: "In the short term, I think that we're gonna see a lot more hacks," while adding that stronger defenses could reduce losses over time.

The concrete takeaway from the interview is his call for shared security standards or an industry alliance, which remains at the discussion stage with no details agreed.

Sources

• CoinDesk