Bitget Hack Highlights Limitations of Freezing Assets on Blockchain

The recent Bitget hack has highlighted the limitations of freezing assets on the blockchain. The attack resulted in the theft of nearly $388 million, with approximately 103 million XRP being taken and distributed among five accounts.

Ripple's inability to freeze the stolen XRP stems from the XRP Ledger's architecture, where native XRP does not have an issuer that can activate protocol-level freezes. Issued assets such as USDT and USDC can be frozen by their issuers, but native XRP cannot.

Exchanges, however, can still restrict accounts receiving stolen funds when they reach a centralized platform. The Bitget hack demonstrates the importance of blockchain traceability in asset recovery, but it also highlights the limitations of relying solely on freezing assets to recover stolen funds.