Binance Reopens TORN Deposits After Tornado Cash DAO Attack
Binance, a leading cryptocurrency exchange, has resumed TORN deposits after a recent attack on the privacy-focused crypto mixer’s DAO, Tornado Cash.
On Monday, the exchange announced that TORN deposits are now available again via the Ethereum (ETH) network and Binance’s BNB Smart Chain.
These deposit services were temporarily suspended on May 21 due to the aforementioned incident. However, with the successful execution of the proposal to restore governance in the TORN DAO, Binance has reopened the deposits.
#Binance has resumed deposits for $TORN on the Ethereum and BNB Smart Chain networks.
In addition, we have decided to move TORN into the Innovation Zone by May 30, 2023.
More details here ➡️ https://t.co/OOQQwmcERs https://t.co/T5MwYFTIf7
— Binance (@binance) May 29, 2023
Binance Transfers Tornado Cash to Innovation Zone for Enhanced Monitoring:
In a recent review, Binance has made the decision to move Tornado Cash into its Innovation Zone by May 30.
This strategic move entails closely monitoring the developments of Tornado Cash, as projects placed within the Innovation Zone receive heightened scrutiny. Binance aims to ensure the ongoing progress and security of Tornado Cash through this transfer.
Unidentified Attackers Seize Control of Tornado Cash DAO, Exploit Governance System:
Approximately ten days ago, a group of unidentified attackers successfully hijacked the DAO responsible for managing the operations and funds of Tornado Cash. Exploiting the governance system, the attackers employed a deceitful proposal that concealed a code function, granting them counterfeit votes within the DAO.
Taking advantage of this unauthorized access, the attackers proceeded to withdraw and sell 10,000 votes in the form of TORN tokens. Moreover, they maliciously minted over 1 million TORN tokens, which hold a combined value exceeding $4 million.
It’s important to note that the attack did not directly impact the underlying Tornado Cash protocol, which enables users to obfuscate the movement of funds.
Also Read This Related: South Korea Proposes Fund Freezing System for Binance and Major Crypto Exchanges
In response to the incident, the Tornado Cash community proposed a reversal of the modifications made by the attacker. However, the attacker, not relenting, posted a new proposal on Tornado Cash to restore the state of governance.
However, recent reports indicate that the hacker has relinquished control over the service, while utilizing the protocol itself to launder the pilfered digital tokens. According to Bloomberg, the attacker swapped the majority of the stolen TORN tokens (approximately 483,000) into ETH and subsequently laundered 472 ETH.
Following the protocol’s compromised state after the attack, Binance temporarily halted TORN deposits. This action further impacted the declining price of TORN, as market participants reacted to the unfolding events related to the security breach.
As of the time of writing (Tuesday morning UTC), the governance token of Tornado Cash, TORN, was trading at $4. It has experienced a decrease of over 10% in a day, 13% in a week, 50% in a month, and 87% in a year.
Important: This article is intended solely for informational purposes. It should not be considered or relied upon as legal, tax, investment, financial, or any other form of advice.
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