The fallout from the theft of billions of dollars from Binance is still unfolding, and this time the hackers have put the word “brazen” right on the blockchain.
According to the latest XRP Ledger records, on Monday the hackers completed nine large transfers in just eight minutes, dispersing as many as 233.46 million XRP (worth hundreds of millions of dollars) across six brand-new anonymous wallets.
What’s even more frustrating is that Ripple itself seems powerless in the face of this brazen money laundering. What exactly is going on? Can this huge sum still be recovered?
The core problem: Decentralization has become a “get-out-of-jail-free card” for hackers
In this major heist, we saw two very different fates for assets:
Stablecoins (USDT/USDC): Tether and Circle can instantly blacklist addresses, and froze more than $2.3 billion in assets.
Native XRP: cannot be frozen. Under the fundamental rules of the XRP Ledger, no centralized issuer has the authority to directly freeze native XRP on the ledger. Ripple can freeze stolen RLUSD (its own stablecoin), but it is powerless to do anything about these 230 million native XRP.
People often say that “decentralized censorship resistance” is the ultimate ideal of public blockchains. But when hackers strike, it becomes a nightmare for law enforcement and exchanges. The hackers saw this coming, which is why they treated the funds as the safest possible spoils.
🕵️ Money laundering in action: a textbook vanishing act
The hackers were extremely skillful, following a textbook money-laundering playbook:
1. Lying low and testing: The funds sat quietly in the wallet for about 80 hours. The hackers first sent six test transfers of 1,000 XRP each to make sure the route was safe.
2. Rapid splitting: Then, within eight minutes, five wallets each received about 40 million XRP, while a sixth received 33.46 million. This “divide and conquer” approach instantly turned one trail into six, sharply increasing the difficulty of cashing out and the cost of tracking the funds.
3. Rapid cash-out: On-chain tracker Lookonchain has already discovered that about $250,000 of the stolen funds flowed into the Gate exchange within 12 hours. Although this is only a small portion of the funds so far, it shows that the hackers have started testing the market and cashing out.
Binance’s backstop and the FBI’s accusation: Who is pulling the strings?
For ordinary users, the biggest concern is the safety of their funds. The good news is that Binance has officially stated that company funds have covered about 95% of the affected amount, and that XRP balances are fully backed. In the midst of this epic black swan event, that should offer users some reassurance.
As for the perpetrators, the FBI has directly blamed the North Korea-linked hacking group “TraderTraitor,” saying they are converting the stolen funds into Ethereum. Interestingly, Kim Yo Jong of North Korea has just issued a statement denouncing this as “absurd.”
A retail investor’s guide: three lessons from this incident
This multi-billion-dollar heist is not just a clash between Binance and hackers—it’s also a vivid risk-management lesson for everyone in crypto:
1. Understand the double-edged sword of “censorship resistance”
When allocating assets, remember that native tokens (such as BTC, XRP, and ETH) are extremely vulnerable when it comes to theft prevention and freezing mechanisms. Holding a reasonable amount of stablecoins subject to strict regulation and capable of being frozen may provide a safe haven in extreme circumstances.
2. Don’t believe that big players are too big to fail
Binance was able to cover the losses with its deep pockets this time, but the fact that even a top exchange’s signing infrastructure can be breached shows that no platform is completely safe. It’s still advisable to store large sums in cold wallets and keep only the funds needed for trading on exchanges.
3. Stay away from “dirty money” at small exchanges
Hackers prefer to cash out through small exchanges with weak anti-money-laundering (AML) systems, such as Gate, which was used in this incident. If you see unusually large orders priced far below the market on these platforms, stay away! If your account becomes linked to illicit funds, you could end up with your bank card frozen or your account suspended at any time.
The hackers’ money laundering is still ongoing, and it remains unclear how much of these 230 million XRP will ultimately be recovered. In this dark forest, protecting your private keys and respecting the market are what will help you survive in the long run.
Do you think these XRP can ultimately be recovered if they are moved in fragments through decentralized exchanges? In the face of an attack like this with no clear solution, do you think “centralized freezing” is a good thing or a bad thing? Share your thoughts in the comments!