Key Points

• It is reported that the Federal Reserve and OCC contacted banks after the intrusion into Binance.
• U.S. lending institutions are checking their network security defenses to prevent similar attacks.
• There is currently no confirmed news of any interference with American banks.

It is reported that U.S. banking regulators have begun to investigate whether Binance's record-breaking $6.3 billion hacker attack has exposed potential vulnerabilities in traditional financial institutions, which has raised concerns that cyber security risks may spread from cryptocurrency exchanges to the broader financial system.

It is alleged that regulators from the Federal Reserve and the Office of the Comptroller of the Currency ( OCC ) began contacting banks on November 2. Officials asked lending institutions whether they noticed any unusual activities or business disruptions after the attacks on October 29.

However, this contact does not constitute a publicly announced formal investigation, and neither of the two regulatory agencies has confirmed any related discussions. To date, no successful attacks on the US banking system related to the intrusion into Binance have been discovered.

Bank of America reviews security after a record-breaking hack at Binance

It is reported that at the time of these inquiries, several large banks were assessing whether their internal systems might be vulnerable to similar vulnerabilities as those exploited by Binance.

Reuters reported that the cybersecurity team of a major U.S. bank contacted Binance within hours of the attack. The team is preparing an internal assessment, which may further trigger security reviews and software updates.

An institution contacted by regulatory authorities stated that there were no service interruptions, and the volume of customer inquiries was also relatively low.

The initial Binance security vulnerability involved attackers gaining access to the internal system and bypassing the normal wallet transaction authorization procedures.

Binance subsequently disclosed that this incident began with a fake job interview targeting one of its employees, after which malware invaded the internal systems.

It is reported that the attackers also utilized an internal artificial intelligence tool throughout the operation, which has raised new concerns for an increasing number of organizations that have deployed autonomous software.

Why Regulators Are Worried About the Spread of Crypto Risks to Wall Street

This concern is not limited to the direct losses of cryptocurrencies themselves.

American banks are increasingly involved in digital asset custody, stablecoin settlement, and financial services related to cryptocurrencies, which further enhances the connection between traditional banking infrastructure and the blockchain market.

If institutions share damaged suppliers, software systems, or vulnerabilities in transaction authorization, these connections may pose operational risks.

However, the attack on Binance does not prove that American banks are using the same vulnerable technology.

A source familiar with regulatory discussions told Reuters that rapidly evolving artificial intelligence technology is making cybersecurity particularly challenging, as attackers are developing more sophisticated methods.

These concerns arose at a time when the Federal Bureau of Investigation (FBI) had attributed the Binance incident to North Korean hackers.

At the same time, U.S. regulatory authorities have relaxed some restrictions on banks' participation in crypto activities, which also makes it more important to maintain strong operational security measures.

Binance continues to recover while regulatory authorities assess risks

Since the attack, Binance has been working hard to restore customer confidence, including using company resources to replace the stolen assets and completing additional reserve verifications.

After approximately 95% of the affected assets were replenished by November 2nd, the exchange's reserve verification checks covered 10 major cryptocurrencies, including Bitcoin, Ethereum, and XRP.

However, customer confidence remains fragile. After resuming services, Binance recorded a net outflow of $4.72 billion, although the exchange stated that withdrawal activities are beginning to stabilize.

Subsequently, the resumption of withdrawals with XRP also marks another step towards returning to normal operations.