Key Takeaways
- • Binance experienced a net outflow of about $3.6bn (£2.7bn) after a $6.3bn theft, equal to 2.1% of its $171bn in total assets under management, according to its latest proof of reserves snapshot.
- • Binance reported $4.6bn in withdrawals and $1bn in deposits by Sunday afternoon as it began a phased reopening of withdrawals.
- • The FBI attributed the hack to North Korea-affiliated group TraderTraitor, which is believed to be part of the Lazarus Group.
- • Binance says it has replenished 90% of the stolen amount and has set aside about $6.34bn of company funds to cover the losses, with co-CEO Richard Teng committing to cover the remaining 10%.
- • Bitcoin fell nearly 5%, ethereum nearly 6%, and BNB nearly 10% following news of the hack.
Summary
Investors have pulled $3.6bn (£2.7bn) from the cryptocurrency exchange Binance as it recovers from a record hack in which $6.3bn was stolen from customer accounts on Thursday. The theft has been described as the largest heist in history. Binance initially froze withdrawals while investigating the breach, then announced on Sunday that it had begun a phased reopening.
By Sunday afternoon, the platform had processed $4.6bn in withdrawals and $1bn in deposits, a net outflow of about $3.6bn, or 2.1% of its $171bn in total assets under management. The company confirmed these figures in its latest proof of reserves snapshot, with a full report expected on Monday. Binance said that after an initial spike, withdrawal volumes were declining and stabilising, while deposit volumes remained substantial. In the first phase, withdrawals were restored for 15 networks and assets, including ethereum, USDT and USDC on the ethereum blockchain, and some assets on the BNB Smart Chain. Dogecoin and Avalanche dealing later resumed on their own platforms.
On the attribution, the FBI said on Saturday that North Korea was responsible for the theft of more than $6bn in virtual assets on or about October 29. The agency said it had observed TraderTraitor actors converting stolen assets into ethereum and expected further laundering through decentralised finance and instant swap services, and it urged private sector entities to block transactions linked to those addresses. TraderTraitor is believed to be part of the Lazarus Group. Binance co-CEO Richard Teng described the breach on Friday as a complex attack involving a compromised laptop and malicious software designed to delete evidence.
Binance said it has replenished 90% of the stolen amount and set aside about $6.34bn of company funds to cover the losses. The remaining 10% is held in less liquid tokens that may take longer to buy, and Teng said the company was committed to covering it so users would not bear the financial impact. Funds used to rebuy tokens came from part of Binance's $1bn secure asset fund, a bitcoin reserve held to protect customers in security breaches, as well as its futures insurance fund and corporate treasury. Bitcoin dropped nearly 5% after the news, ethereum nearly 6%, and BNB, the exchange's native token, nearly 10%.
By Sunday afternoon, the platform had processed $4.6bn in withdrawals and $1bn in deposits, a net outflow of about $3.6bn, or 2.1% of its $171bn in total assets under management. The company confirmed these figures in its latest proof of reserves snapshot, with a full report expected on Monday. Binance said that after an initial spike, withdrawal volumes were declining and stabilising, while deposit volumes remained substantial. In the first phase, withdrawals were restored for 15 networks and assets, including ethereum, USDT and USDC on the ethereum blockchain, and some assets on the BNB Smart Chain. Dogecoin and Avalanche dealing later resumed on their own platforms.
On the attribution, the FBI said on Saturday that North Korea was responsible for the theft of more than $6bn in virtual assets on or about October 29. The agency said it had observed TraderTraitor actors converting stolen assets into ethereum and expected further laundering through decentralised finance and instant swap services, and it urged private sector entities to block transactions linked to those addresses. TraderTraitor is believed to be part of the Lazarus Group. Binance co-CEO Richard Teng described the breach on Friday as a complex attack involving a compromised laptop and malicious software designed to delete evidence.
Binance said it has replenished 90% of the stolen amount and set aside about $6.34bn of company funds to cover the losses. The remaining 10% is held in less liquid tokens that may take longer to buy, and Teng said the company was committed to covering it so users would not bear the financial impact. Funds used to rebuy tokens came from part of Binance's $1bn secure asset fund, a bitcoin reserve held to protect customers in security breaches, as well as its futures insurance fund and corporate treasury. Bitcoin dropped nearly 5% after the news, ethereum nearly 6%, and BNB, the exchange's native token, nearly 10%.
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