The recent Bitget security breach has brought to light a fundamental technical distinction between XRP and issuer-managed assets such as USDT and USDC. While trading platforms have the ability to block accounts that receive stolen cryptocurrency, Ripple lacks the capability to simply freeze native XRP while it sits inside a wallet controlled by an attacker on the XRP Ledger.
Bitget Lost Nearly USD 388 Million
Initially, Bitget estimated its losses from the September 24 exploit at roughly USD 351.6 million. This figure was subsequently revised upward to USD 387.5 million once investigators accounted for additional compromised assets running on the Tron and Zcash networks.
The breach impacted funds across several different blockchains, including XRP, ETH, USDT, and USDC. According to Bitget, the root vulnerability has been identified and patched, and the company has partnered with cybersecurity specialists Mandiant and SlowMist to handle the ongoing investigation and recovery process.
The hackers made off with nearly 103 million XRP, initially spreading the tokens among five distinct accounts. By September 28, approximately USD 83 million of that stolen XRP had been transferred out of three holding wallets, leaving roughly USD 75 million sitting in the original addresses.
Why Ripple Cannot Freeze Native XRP
Ripple’s inability to freeze the stolen funds is not a matter of choice; it is a direct consequence of how the XRP Ledger is architected. Because XRP serves as the network’s native asset, it has no issuer. Official documentation for the XRP Ledger specifies that its freeze capabilities apply exclusively to issued tokens, leaving native XRP untouched.
Issued digital assets operate under a different set of rules. Any organization that issues a token on the XRPL can leverage specific protocols—such as the Global Freeze or Individual Freeze features—to restrict balances under particular conditions.
Because Ripple does not act as an issuer governing native XRP balances, it has no power to blacklist an attacker’s self-custody address or force the XRP Ledger to reject transactions that are otherwise valid.
USDT and USDC have Different Controls
Centralized stablecoins provide a clear point of comparison. Tether and Circle issue USDT and USDC respectively, and both companies possess built-in tools to blacklist specific addresses. In the wake of the Bitget attack, Circle and Tether managed to freeze roughly USD 320,000 worth of stablecoins tied to the incident. Those issuer-level safeguards simply do not exist for native XRP.
Exchanges Can Still Restrict Stolen Funds
The fact that XRP cannot be frozen at the protocol level does not leave investigators powerless. Once stolen XRP is deposited into a centralized trading platform, that platform can pinpoint the relevant user account, freeze withdrawals, and collaborate with law enforcement.
Furthermore, because XRP Ledger transactions are logged publicly, blockchain analytics firms can monitor where the funds travel. This puts a heavy emphasis on where the attacker sends the assets. While coins resting in self-hosted XRP wallets remain unfreezable, moving them into a regulated centralized platform introduces a new window for intervention.
Bitget has confirmed that user balances remain safe and that internal reserve funds will absorb the losses. The exchange has also begun reopening withdrawals in a phased approach following thorough security reviews.
Final Thoughts
Ripple cannot freeze native XRP because the asset lacks an issuer with protocol-level freeze authority, though centralized exchanges retain the power to restrict accounts that receive illicit funds. Ultimately, the Bitget incident demonstrates that robust blockchain traceability does not guarantee immediate asset recovery.
Also Read: XRP Price Rally Tops 60% as Whales Target Major Breakout
FAQs:
1. Why can’t Ripple freeze stolen XRP?
XRP is the native asset of the XRP Ledger and does not have an issuer with freeze authority. Ripple therefore cannot blacklist self-custodied XRP or prevent otherwise valid transactions.
2. How much XRP was stolen in the Bitget hack?
Nearly 103 million XRP was taken and initially distributed across five accounts. By September 28, around USD 83 million worth of stolen XRP had moved from three holding wallets.
3. Why can USDT and USDC be frozen but XRP cannot?
USDT and USDC are issued by Tether and Circle, which maintain mechanisms for blacklisting certain addresses. Native XRP has no equivalent issuer capable of activating such controls.
4. Can exchanges freeze XRP stolen by hackers?
Yes, centralized exchanges can restrict accounts when stolen XRP reaches their platforms. They can suspend withdrawals and cooperate with investigators, even though XRP itself cannot be frozen at the protocol level.
5. Can stolen XRP still be tracked on the blockchain?
Yes. XRP Ledger transactions are publicly recorded, allowing blockchain analytics firms and investigators to trace movements between addresses, although tracking the funds does not automatically mean they can be recovered.
