Binance sets aside $6.34bn to repay users after record crypto heist

Binance has committed more than $6.34 billion in company funds to cover losses suffered by users following a massive security breach that saw hackers steal an estimated $6.3 billion in cryptocurrency.

The cryptocurrency exchange said it had started replenishing the affected assets while working with law enforcement agencies, blockchain intelligence firms and industry partners to trace and recover the stolen funds.

In an update on Friday, October 30, Binance disclosed that more than $5 billion of the funds reserved to compensate affected users were already available in the exact cryptocurrencies involved in the incident.

The company said it was purchasing the remaining assets through cryptocurrency market transactions and over-the-counter (OTC) channels to ensure the replacement funds matched the types of tokens taken during the attack.

Binance explained that completing the process could take additional time because some of the affected cryptocurrencies have limited market liquidity, while OTC transactions require extra settlement time.

The exchange also disclosed that approximately $3 billion in affected assets had already been frozen through cooperation with industry partners.

It said the frozen funds were separate from the $6.34 billion reserve set aside to cover users’ losses.

Binance had earlier assured customers that it would bear the financial consequences of the security breach through its Secure Asset Fund for Users (SAFU) and other company resources.

The company reiterated that it would cover all confirmed shortfalls and provide further updates as the recovery process progresses.

It also said users would eventually be able to verify the status of their funds through its publicly available proof-of-reserves system.

The incident triggered concerns across the cryptocurrency industry after hackers reportedly drained approximately $6.3 billion from wallets connected to the exchange.

Binance’s initial investigation pointed to a possible compromise of a laptop belonging to a DevOps engineer, which allegedly provided attackers access to a service container used to process withdrawal transactions.

The company later disclosed that further investigations had uncovered additional points of breach.

Binance said it had found no evidence that wallet private keys were leaked and was working with law enforcement agencies to establish how the attack happened and identify those responsible.

The exchange also temporarily suspended withdrawals as part of its security response, while deposits remained unaffected.

The recovery effort is expected to involve continued cooperation with blockchain partners and asset issuers to prevent the stolen cryptocurrencies from being moved or converted.