Key Takeaways
- • Binance says it has covered 95% of losses from an October 29 cyberattack that drained approximately $6.3 billion in digital assets, up from roughly 90% announced on October 31.
- • The exchange has set aside more than $6.34 billion in corporate funds to compensate losses and buy the tokens needed to restore collateral backing client balances.
- • Binance drew on corporate reserves, the Futures Insurance Fund and the SAFU reserve, with half of SAFU reserves used per co-head Ji He, and has pledged to restore SAFU to about $1 billion later.
- • Full backing has been restored for ten cryptocurrencies, while the remaining 5% relates to less liquid assets that are harder to buy without moving prices.
- • The FBI attributed the attack to North Korea's TraderTraitor group, and Binance has begun phased resumption of withdrawals starting with Bitcoin on November 1.
Summary
Binance, the world's largest cryptocurrency exchange, has announced that it has covered 95% of losses following a cyberattack on October 29 in which approximately $6.3 billion in digital assets were stolen. The figure rose from about 90%, which the exchange reported on October 31, according to a statement issued early on November 1. In total, the company has set aside over $6.34 billion in corporate funds to compensate for losses and to purchase the cryptocurrencies needed to restore the collateral backing client balances.
According to Binance, the effort is not primarily about recovering the assets directly taken by hackers. Instead, the exchange is buying tokens on the open market and through over-the-counter transactions with major counterparties to replenish reserves. Full support has been restored for ten cryptocurrencies: Bitcoin, Ethereum, Tether, BNB, Solana, USD Coin, XRP, USD1, RLUSD and Zcash. The remaining 5% relates to less liquid assets that are more difficult to acquire in volume without significantly affecting market prices. The company says the financial consequences will not be passed on to users.
To cover the shortfall, Binance drew on three sources: its own corporate reserves, the Futures Insurance Fund, which is normally used to cover risks when closing futures positions and from which the company said it used only the portion exceeding the required level, and the Secure Asset Fund for Users (SAFU), a reserve set up in 2018. Per a Reuters report, co-head Ji He said half of SAFU's reserves would be used. Binance has committed to restoring the fund to approximately $1 billion at a later date.
Binance has begun gradually resuming withdrawals, which were suspended after the hack for safety checks. Bitcoin withdrawals were the first to become available on the morning of November 1, with later phases covering Ethereum, BNB, Solana, XRP, Dogecoin and other assets across networks including BNB Smart Chain, Tron, Arbitrum and Base. Availability depends on the network used for a transfer, and the exchange has warned of possible delays due to heavy traffic. Account top-ups remained available throughout the suspension.
The US Federal Bureau of Investigation stated on October 31 that the North Korean group TraderTraitor was behind the attack, and said members had begun converting some stolen assets into Ethereum for money laundering through decentralised finance services. North Korea has traditionally denied state involvement in crypto thefts. Co-CEO Richard Teng reportedly said attackers may have gained access to internal systems through a compromised employee laptop, and investigators found signs of malware used to cover their tracks. Blockchain analytics experts estimated that most of the funds were withdrawn within about 20 minutes. Per Reuters, as of October 30, the whereabouts of roughly $3 billion had been established, though tracing or freezing funds does not guarantee their return. Binance has promised a detailed report on the breach once audits are complete.
According to Binance, the effort is not primarily about recovering the assets directly taken by hackers. Instead, the exchange is buying tokens on the open market and through over-the-counter transactions with major counterparties to replenish reserves. Full support has been restored for ten cryptocurrencies: Bitcoin, Ethereum, Tether, BNB, Solana, USD Coin, XRP, USD1, RLUSD and Zcash. The remaining 5% relates to less liquid assets that are more difficult to acquire in volume without significantly affecting market prices. The company says the financial consequences will not be passed on to users.
To cover the shortfall, Binance drew on three sources: its own corporate reserves, the Futures Insurance Fund, which is normally used to cover risks when closing futures positions and from which the company said it used only the portion exceeding the required level, and the Secure Asset Fund for Users (SAFU), a reserve set up in 2018. Per a Reuters report, co-head Ji He said half of SAFU's reserves would be used. Binance has committed to restoring the fund to approximately $1 billion at a later date.
Binance has begun gradually resuming withdrawals, which were suspended after the hack for safety checks. Bitcoin withdrawals were the first to become available on the morning of November 1, with later phases covering Ethereum, BNB, Solana, XRP, Dogecoin and other assets across networks including BNB Smart Chain, Tron, Arbitrum and Base. Availability depends on the network used for a transfer, and the exchange has warned of possible delays due to heavy traffic. Account top-ups remained available throughout the suspension.
The US Federal Bureau of Investigation stated on October 31 that the North Korean group TraderTraitor was behind the attack, and said members had begun converting some stolen assets into Ethereum for money laundering through decentralised finance services. North Korea has traditionally denied state involvement in crypto thefts. Co-CEO Richard Teng reportedly said attackers may have gained access to internal systems through a compromised employee laptop, and investigators found signs of malware used to cover their tracks. Blockchain analytics experts estimated that most of the funds were withdrawn within about 20 minutes. Per Reuters, as of October 30, the whereabouts of roughly $3 billion had been established, though tracing or freezing funds does not guarantee their return. Binance has promised a detailed report on the breach once audits are complete.
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