Binance is reportedly the latest casualty of a crypto heist. Binance- one of the world’s largest crypto-currency exchanges- said hackers stole 7,000 Bitcoins worth about $40 million dollars.
This enormous heist according to them was carried out via a single transaction, in a large scale security breach. The hackers reportedly used a “variety of techniques” which included phishing and viruses to obtain a large amount of user data.
Binance reveled on its website that there may be additional accounts that have been taken down but yet to be identified, after hackers had their way with the exchange’s system. After the news broke out, the largest digital tokens including Bitcoin slid by about 3 percent just to bounce back considerably hours later.
Binance, who expressed regret after the incident; will use its secure asset fund for users, which is an emergency insurance fund, to cover for the massive loss. Users will therefore not be affected by the massive heist that made headlines and reverberated around the crypto community.
The fraudulent transaction was limited to Binance’s BTC hot wallet, which contains about 2 percent of the company’s Bitcoin holdings, according to the post. According to the post, other wallets are secure and unharmed.
While expressing his disappointment with the incident, Binance CEO Zhao Changpeng said this; “The hackers had the patience to wait, and execute well-orchestrated actions through multiple seemingly independent accounts at the most opportune time,”
Not the best of days, but we will stay transparent. Thank you for your support!https://t.co/Y1CQOatEpi— CZ Binance (@cz_binance) May 7, 2019
“We must conduct a thorough security review. The security review will include all parts of our systems and data.” He added.
Binance estimates that this thorough review will take a week, during which all deposits as well as withdrawals will remain suspended. Trading will however remain enabled to allow investors to adjust their positions. Binance also suspect that hackers may still be in control of some accounts and may use them to alter price points.
“The hackers may still control some user accounts and may “use those to influence prices in the meantime,” the exchange said.
Going back to how the exchange was breached and robbed, it was revealed that the hackers were able to bypass existing security checks, and were unable to block the withdrawal before it was executed. Once the transaction was executed, it triggered alarms on Binance’s security systems and all withdrawals were stopped. The Firms CEO then communicated the incident on Twitter by expressing disappointment and then went on to reassure the clients.
The Binance heist is just one among a series of heists that have plagued the crypto-industry. Individual investors have been targeted, and exchanges such as Binance have not been spared either. The Binance heist to us is a call to caution. It will also definitely raise debates about whether to store your crypto in cold wallets vs exchanges.
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