The centralised part of the “CeDeFi” did not help much, however.
Binance announced Wednesday that it has successfully recovered about $344,000 in funds from an attempted coup at the Wine Swap, a project of Binance Smart Chain (BNB).
The Wine Swap was an automated market taker platform, similar to Uniswap, launched on October 13. Within an hour of its launch, it had accumulated $345,000 in funds, which were quickly withdrawn from the platform by the creators of the Wine Swap.
The funds were then sent to various addresses in an attempt to get them out of Binance Smart Chain. Most of the funds were migrated to the Ethereum blockchain, although a portion was also sent to the centralized Binance platform and two other exchanges, being frozen immediately, Binance said.
Later, the Bitcoin Benefit team was able to identify the creators of the Wine Swap through on-chain analysis. The criminals returned the money when they learned that they had been caught.
The money is expected to be returned to its original owners after the alleged scammers converted part of it into other tokens.
The story is not unlike DeFi hacks like dForce or the September bZX hack. In all cases, the perpetrators were caught through online analysis or other external factors.
Binance states that they cannot control funds in Binance Smart Chain, nor even freeze them. Only those who reach the exchange are under the company’s control.
The incident illustrates how it may be possible for hackers and scammers in Binance Smart Chain to avoid capture using some of the decentralized bridge options.
However, the Smart Chain ecosystem remains isolated: Binance largely controls validation through its participation in the BNB, and the bridges appear to be presenting a useful bottleneck to strengthen tracking in the chain.
Binance Smart Chain is a smart contract enabled blockchain launched by the exchange. It is fully compatible with the Ethereum Virtual Machine and comes as part of the company’s approach to decentralized finance, referred to as “centralized decentralized finance” by Binance Changpeng Zhao’s CEO.