Binance and Kraken Reportedly Fend Off Social Engineering Hack
According to a report by Bloomberg News, cryptocurrency exchanges Binance and Kraken have successfully repelled a recent social engineering cyberattack without compromising customer data. The news comes on the heels of another prominent crypto firm, Coinbase, which earlier this week revealed it had fallen victim to a similar attempt at extortion.
Last week, Coinbase disclosed that its system was targeted by hackers who attempted to gather sensitive information from unsuspecting customers. The attackers impersonated company insiders and stole data from customer support tools, aiming to extort the company for $20 million. However, Coinbase rejected the demands and took swift action, firing the compromised employees on the spot and referring them to law enforcement authorities.
Bloomberg's sources indicate that Binance and Kraken were similarly targeted in a social engineering attack, with scammers attempting to bribe customer-service agents into divulging sensitive information. The attackers allegedly offered a Telegram handle to contact the culprits, further highlighting the sophisticated nature of these cybercrimes.
The Rise of Social Engineering Attacks in Crypto
The recent attacks on Binance and Kraken have raised concerns about the increasing sophistication of social engineering scams in the crypto space. According to a PYMNTS Intelligence report, "The State of Fraud and Financial Crime in the U.S. 2024: What FIs Need to Know," social engineering fraud has jumped by 56% over the past year.
These attacks often rely on tactics such as fear, urgency, and fake customer service lines to trick victims into divulging sensitive information. As the value of digital assets like bitcoin continues to climb, crypto firms are facing an increased risk of these types of attacks.
The Largest Cyberattack in Crypto History
Earlier this year, Bybit exchange suffered a historic $1.5 billion cyberattack, which remains the largest such theft on record. The incident led to a 303% surge in cryptocurrency thefts during the first quarter of the year.
Coinbase's Response and Projections
Coinbase has projected that the recent data breach could cost it up to $400 million, according to its latest Securities and Exchange Commission (SEC) filing. The company has also stated its intention to reimburse customers who were tricked into sending funds to criminals.
Binance and Kraken's Response
Despite being targeted by social engineering attacks, both Binance and Kraken have successfully repelled the attempts without compromising customer data. Their in-house policies and technologies appear to have played a significant role in preventing the attacks.
The companies have declined to comment on the matter, but sources indicate that they were able to fend off the attacks by implementing robust security measures and educating their employees about social engineering tactics.