Buterin urges crypto exchanges to prioritize security over growth

Buterin described the defensive stance as “bunker mode,” saying attacks have shifted from smart contracts toward user interfaces and centralized systems used by exchanges and custodians to manage customer assets. He said smart contract exploits have fallen sharply over the past 18 months, while major incidents have increasingly involved those surrounding systems.

His remarks followed the October 29 Binance security breach, in which approximately $6.3 billion in cryptocurrency was stolen across multiple blockchains. Binance linked the intrusion to fraudulent job interviews, malicious software and compromised employee systems. Attackers reportedly obtained credentials that let them interfere with the exchange’s wallet-signing infrastructure.

Buterin said exchanges could make greater use of on-chain systems, where transactions can benefit from stronger cryptographic security, and recommended multisignature wallets and stronger safeguards for customer funds. He also warned that continued thefts, particularly those linked to North Korean hackers, could lead regulators to impose stricter security obligations on exchanges and custodians. South Korean regulators have asked domestic exchanges to strengthen cold storage, withdrawal approvals and internal access controls following the breach.

On Ethereum’s development plans, Buterin said artificial intelligence could speed work on the Lean Ethereum roadmap, which also draws on zero-knowledge proofs and formal verification. He said AI had cut the time needed to develop and verify complex blockchain infrastructure, and that formal verification could help check whether new code and algorithms behave as intended.

Buterin said Ethereum would use conservative, hash-based cryptography for its underlying blockchain, while Layer 2 networks should pursue specialized applications. He cited high-performance decentralized finance and privacy, naming Lighter and Aztec, as well as enterprise systems for verifying supply-chain, healthcare and manufacturing records without revealing sensitive information. He also pointed to growth in tokenized real-world assets on Ethereum over the past 18 months, while acknowledging that traditional financial applications would retain identity checks and restrictions on eligible users.