A suspected hack impacting billions of dollars of funds on the Binance crypto exchange spurred emergency asset freezes and sent the price of digital assets tumbling. Executives of the world’s biggest trading venue said they were investigating and that customer funds were safe.
Binance (Credits: Insurance Journal)
Binance Hack: Emergency Freezes And Bitcoin Drops
“We are aware of reports of a potential security issue and we are actively investigating,” a Binance spokesperson said. “At this stage, we have not confirmed any impact to user funds.” Changpeng Zhao, the co-founder of Binance who goes by CZ and remains its largest shareholder, said the exchange may have been hacked but that user funds were safe.
The two biggest stablecoin issuers moved fast: Tether CEO Paolo Ardoino said it froze more than $1.5 billion of its stablecoin “related to a potential Binance exchange hack,” while Circle’s Jeremy Allaire said $800 million of its coin had been frozen amid reports of a potential exploit involving Binance.
SAFU Reserve Fund And Market Fallout
Binance pointed to its Secure Asset Fund for Users (SAFU), an emergency insurance and reserve fund established in 2018 as a backstop for customers in “extreme situations,” generally maintained at around $1 billion, though it has fluctuated with market movements.
Bitcoin fell as much as 3.7% — below $79,000 and its lowest level since September — with other tokens also selling off, and the Nasdaq 100 tech index dropped nearly 1.4%. “Hot wallets getting drained is not something new to crypto, but the amount would be a meaningful hack on the largest crypto exchange,” said James Seyffart at Bloomberg Intelligence. “It’s definitely a bad look. And this is one after another,” he said of the recent spate of incidents that has also hit Bitget and other platforms.
Also Read: Binance Hacker Splits $1.4 Billion of Stolen Bitcoin Into 19 Wallets No One Can Freeze | Binance Hack Fallout: Institutional Crypto Investors Rush to Pull Funds From Exchanges
Source: Insurance Journal — read the full story there.
