'Binance Founder on Record Crypto Hack: "If Crypto Exchanges Get Hacked, Banks Are Even More Vulnerable"

Changpeng Zhao (CZ), founder of Binance, which suffered the largest cryptocurrency theft in history, has predicted that the advancement of artificial intelligence (AI) technology will lead to an increase in cyberattacks targeting cryptocurrency exchanges and banks.

In an interview with cryptocurrency media outlet CoinDesk on November 3 local time, Zhao stated, "The only way for the industry to defend against AI-driven hacking is to utilize AI itself."

Having stepped down from the front lines of Binance's management, he pointed out that hackers are acquiring AI capabilities faster than financial institutions can adopt AI to protect their systems.

In particular, noting that AI-induced cyber threats are not limited to the cryptocurrency industry, he argued, "If cryptocurrency exchanges are getting hacked, in my view, banks are in an even more dangerous position."

"In the short term, we are going to see a lot more hacking incidents," he said, while anticipating that over time, financial security will ultimately be strengthened as AI is also incorporated into defense systems.

He also shared his stance on customer fund withdrawals following the recent incident.

He explained that the initial 3.6 billion dollars (approx. 4.8 trillion KRW) withdrawn after withdrawal services resumed accounted for only about 2 percent of Binance's total asset holdings.

He added that while he initially expected a massive bank run reaching 10 to 30 percent of total assets, the actual scale was much smaller.

However, contrary to Zhao's warning that day about the dangers of AI hacking, major blockchain analysis firms have released reports indicating that North Korean hackers utilized automated algorithms rather than relying on AI agents.

Previously, the Federal Bureau of Investigation (FBI) pointed to North Korea's elite hacking organization "TraderTraitor" as the mastermind behind the Binance hacking incident.

Zhao, who founded Binance in 2017, pleaded guilty in 2023 to charges including violations of anti-money laundering regulations and securities laws, paid a 4.3 billion dollar fine, and stepped down as Chief Executive Officer (CEO) of Binance.

Following U.S. President Donald Trump's return to power, Zhao and Binance lobbied for a pardon and ultimately received one in October of last year.

At the time, President Trump caused controversy when asked by reporters about the reason for the pardon, answering, "I don't know who he is."

Since then, Zhao has maintained a close relationship with President Trump's side, including attending a banquet hosted by the Trump family's cryptocurrency venture, World Liberty Financial, at the Mar-a-Lago resort in Florida.

(Photo: AP, Yonhap News)
※ Please note: This article was translated by AI and may contain errors.