Binance covers 90% of US$6.3 billion hack losses
The world's largest crypto exchange used company funds to replace stolen tokens, with the FBI attributing the breach to North Korea's TraderTraitor unit.
Binance replenishes stolen funds
Global cryptocurrency exchange Binance announced on Saturday (31 October) it had restored 90 per cent of the US$6.3 billion lost in a recent hack. The company purchased new tokens using its own capital to replace the stolen digital assets. Co-CEO Richard Teng stated on Saturday that Binance users would not face any financial impact from the incident.
The exchange aims to cover the remaining 10 per cent, which comprises less liquid tokens that may take more time to acquire.
Funding the recovery
Binance allocated approximately US$6.34 billion from its internal reserves to facilitate the recovery. These funds were drawn from several sources, including its US$1 billion Secure Asset Fund for Users (SAFU), a bitcoin reserve established to protect customers during security breaches. Additional capital came from its Futures Insurance Fund and the company's corporate treasury.
Following the breach, Binance temporarily suspended customer withdrawals but indicated plans to resume them on Sunday (1 November).
Attack attribution and methods
The Federal Bureau of Investigation (FBI) confirmed on Saturday that the North Korean state-sponsored group known as TraderTraitor was responsible for the sophisticated attack. Law enforcement agencies observed members of this unit converting the stolen assets into Ethereum (ETH), with the FBI anticipating "further laundering" through related technological means.
Binance Co-CEO Richard Teng described the incident as a "complex attack", involving a compromised laptop and malicious software designed to erase evidence of its activity.
Market stability and asset verification
The swift recovery efforts by Binance aim to stabilise confidence in the digital asset market, which saw crypto prices decline on Friday (30 October) following news of the hack. For Asian investors and market participants, this incident highlights ongoing security risks within the decentralised finance space.
Binance also initiated a new snapshot of assets on its platform as of midnight on 31 October, as part of its proof-of-reserves process. This allows users holding ten specified tokens, including BTC, ETH, and BNB, to verify a minimum 1:1 backing once full proof becomes available.
This article is journalism, not investment advice; consult a licensed professional before making financial decisions. Market data is indicative, may be delayed, and should be verified with your broker or exchange before use.
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