The end of security brought about by AI, can trust in virtual assets be redesigned? > News

The key to the Zcash incident is that AI immediately discovered a vulnerability in the protocol that even human experts could not find over a long period of four years. Entropic’s ‘Claude Opus 4.8’ precisely penetrated the gap in Zcash’s zero-knowledge proof circuit and proved that unlimited counterfeiting of tokens is possible. Although this was technically a triumph for security research, it became a fuse that sparked fear in the market. Investors realized that the brand value of Zcash as a ‘security powerhouse’ that had been built so far was quickly a mirage and began panic selling. Although an immediate patch was made through the efforts of white hackers, and the follow-up model ‘Mythos’ confirmed that there were no additional defects, it was not enough to restore the trust that had already been damaged.

This incident clearly shows that security screening using AI is a double-edged sword. On the positive side, AI offers hope that it can proactively block potential threats by performing code analysis that goes beyond human cognitive limitations. However, on the other hand, if malicious hackers use AI to write more sophisticated and destructive attack code, there is a high risk that the defenders will be chased forever. Experts such as Ben-Sasson warn that this discovery was lucky to fall into the hands of white hackers first, and that black hackers will soon weaponize AI to carry out even more lethal attacks. Now, the field of security has transformed into an infinite speed battle between human intelligence and AI's computing power.

The virtual asset market is shaken not only by the shock of Zcash but also by the huge waves of change surrounding its incorporation into the institutional system. With the emergence of the Bitcoin spot ETF, virtual assets are no longer a separate ecosystem, but are deeply integrated into Wall Street's risk management system. This raised the institutional status of the asset, but at the same time strengthened its character as a ‘risk asset’ that reacts sensitively to global macroeconomic variables and stock market trends. In addition, the nature of virtual assets globally is rapidly being reorganized from ‘decentralized digital gold’ to ‘regulated financial assets’, with emerging countries such as Zimbabwe establishing regulatory frameworks to bring virtual assets from informal markets into the institutional system.

Amid these changes, the response of the Chinese judiciary is a very noteworthy indicator. China strictly denies the status of virtual assets as legal tender, but shows a dual attitude by applying theft to theft cases and clearly acknowledging their property value. This is a realistic strategy to establish a legal basis for judicial disposition, such as sale, incineration, and return of confiscated virtual assets. Additionally, as seen in the case of FTX founder Bankman-Fried's prison sentence being upheld, the global legal community has begun to treat virtual asset-related fraud crimes as serious crimes at the same level as general financial crimes. In other words, the process of the virtual asset market moving from a lawless place to being within the bounds of the law is accompanied by a very painful and strict process of control.