Binance Has Been Hacked - Lost 7,074 BTC

[Naida_BR]

rip 7k btc.

Source: https://binance.zendesk.com/hc/en-us/articles/360028031711
TX: https://www.blockchain.com/btc/tx/e8b406091959700dbffcff30a60b190133721e5c39e89bb5fe23c5a554ab05ea

And let's not forget some Words of Wisdom from CZ

"Store coins yourself. You fight hackers yourself, and guard from losing wallet yourself. Computer breaks, USBs gets lost.

Store on an exchange. Only use the most reputable, proven secure, exchanges.

Or move to DEX, disrupt ourselves. https://t.co/Ci4ux9I3VD"

— CZ. Jan 15, 2019

It is nice that the #SAFU fund is going to be used and Binance will cover the losses, but I believe that there will be a big drop in bitcoin price and in market capitalization. I think that hackers are going to exchange this cryptocurrency amount to fiat instead of hodling.
It is not safe to store your coins in exchanges but always some amounts will stay there that traders need to store there for their activities.

[mk4]

I think that hackers are going to exchange this cryptocurrency amount to fiat instead of hodling.

Unlikely, if the hackers are smart enough. Trying to sell the BTC for fiat is going to be very difficult for them due to the blockchain's transparency. Selling the stolen BTC on exchanges is already out of the equation. The only chance they have for now is to sell it peer to peer in person, which is another risk, as the buyer can easily report them to the authorities(if the buyer is aware that the funds are stolen).

[Artemis3]

The people who love to leave funds on exchanges unnecessarily for some reason are very lucky that Binance is going to cover the losses.

Jeebus. CZ actually thought of trying to convince miners to do a re-org.



Tweet link: https://twitter.com/cz_binance/status/1125996194734399488

This from their twitter:

After speaking with various parties, including @JeremyRubin, @_prestwich, @bcmakes, @hasufl, @JihanWu and others, we decided NOT to pursue the re-org approach. Considerations being:

Pros:

• 1 we could "revenge" the hackers by "moving" the fees to miners;
• 2 deter future hacking attempts in the process.
• 3 explore the possibility of how bitcoin network would deal with situations like these.

Cons:

• 1 we may damage credibility of BTC,
  
• 2 we may cause a split in both the bitcoin network and community. Both of these damages seems to out-weight $40m revenge.
• 3 the hackers did demonstrate certain weak points in our design and user confusion, that was not obvious before.
• 4 While it is a very expensive lesson for us, it is nevertheless a lesson. it was our responsibility to safe guard user funds. We should own up it. We will learn and improve. As always, thank you for your support!

And as someone correctly pointed out (in the second comment):

• Melik Manukyan

🌮You didn't decide not to, you realized you cannot.

• CZ Binance

‏true that too, that's what Jihan advised/educated me on too.  I trust his advice.

• Simon Dixon

Why would you even consider it? If Binance can re-org Bitcoin we might as well all get out of crypto as JP Morgan and the Fed could too.

• Cicero

‏people still don't understand the value of immutability, the whole point is people shouldn't cover others stupidity

• Spartanec

It's scary that you considered  rollback option on #BTC chain.

• CZ Binance

‏would be very hard to pull off anyway, not for $40m.  Most miners will not "centralize" together just for that.  But it was suggested by some great minds, we learned, considered, and decided not to pursue further.

What is exactly in the mind of these people, Reorganize Bitcoin? Just what those millionaires think they are, lol it took their fellow Jihan Wu to straight them out... (Ie. "I tried but failed...").

Also they should learn from Ethereum when they did that grave mistake that split their blockchain forever...

"Not for $40m"... So they haven't learned their lesson. Some millionaire out there still thinks he can pull off a Bitcoin reorg if he loses some more. Thanks their leniency they "just" losing $40m... What amount would it warrant them doing a fork, or would that be a 51% attack?

[izanagi narukami]

This is really sad when people already being convince to join crypto but it's still hackable

So what's the point of SHA 256 things when hacking incident keep happen in the future ?
With those amount, I'm sure there will be downtrend very soon

[CoinEraser]

Unfortunately you can see again through this hack that no system is really safe and everything and everyone can be hacked. Although the hack is certainly a shock moment for Binance, but through SAFU fund will certainly make everything go well. I'm sure Binance will handle the hack well and it shows, that not every hack in the Bitcoin world will end in a disaster.  

[Artemis3]

This is really sad when people already being convince to join crypto but it's still hackable

So what's the point of SHA 256 things when hacking incident keep happen in the future ?
With those amount, I'm sure there will be downtrend very soon

Bitcoin was not "hacked", that exchange was might have. It was them people failing to protect their exchange funds, not a flaw in Bitcoin. Blaming it on Bitcoin is irresponsible at best.

Edited In case it was a phishing/malware attack performed on users and not an exchange security fault.

[Mpamaegbu]

From the same link you posted above:

Binance will use the #SAFU fund to cover this incident in full. No user funds will be affected.

People will be withdrawing all their coins from their platform to keep their funds safe from any future hacks. Its quite surprising to see Binance been hacked with all their security measures and protocols.

It's really sad this has happened but I don't know why people should be withdrawing their coins after the hack despite the assurance that the lost coins will be covered through SAFU. I am a customer of Binance and I believe it's premature to withdraw my coins at this time. Panic withdrawal is the last thing the Binance exchange needs now. Our support for them should wax strong.

[mk4]

This is really sad when people already being convince to join crypto but it's still hackable

Your point being? An exchange got hacked, not bitcoin.

So what's the point of SHA 256 things when hacking incident keep happen in the future ?

It's like saying what's the point of banking security if people can get robbed on the street? Maybe try listening to what you're saying.

[clover12]

Without reading this forum message. I never would known of the hackings. Then logged into my Binance account, my funds are all sitting still there! 

[pawanjain]

From the same link you posted above:

Binance will use the #SAFU fund to cover this incident in full. No user funds will be affected.

The concern here is not about the funds stolen but about the security breach that allowed the hackers to steal bticoins from the Binance exchange.
The amount 7k BTC now but it can be a greater amount in the future. Although Binance claims that the funds were stolen from the hot wallet which consisted of only 2% of their balance.
What happened to all those security firms Binance partnered with over the last few months ? I am sure they must be having a hard time now that the Binance is hacked.
Although Binance is concerned about the stolen funds and will use SAFU to recover the funds, we as it's users should be aware that any exchange can be hacked and shall keep only a limited amount on the exchange.

[CryptoLing]

I like how Binance handle the hack. The team is very responsive and also they guarantee that all fund will be refund.
We all know how "another" exchange that was hack earlier this year and the safety of the fund is still unknown...

[The Sceptical Chymist]

Its quite surprising to see Binance been hacked with all their security measures and protocols.

Yep, they have more security features on their site than I've ever seen anywhere else.  I'm not sure whether I should be surprised or suspicious, if you know what I mean.

Fortunately, the bitcoin deposit I made right when all this shit went down made it into my account and I was able to buy some NEO with it.  The problem right now is that I can't withdraw anything, and I don't know when that's going to get fixed.  Binance said it should be about a week, but I'm not sure what to believe right now.

This is really sad when people already being convince to join crypto but it's still hackable

Your point being? An exchange got hacked, not bitcoin.

You know when you hear somebody say "join crypto" they have no clue what they're talking about. 

[TryNinja]

The concern here is not about the funds stolen but about the security breach that allowed the hackers to steal bticoins from the Binance exchange.
The amount 7k BTC now but it can be a greater amount in the future. Although Binance claims that the funds were stolen from the hot wallet which consisted of only 2% of their balance.
What happened to all those security firms Binance partnered with over the last few months ? I am sure they must be having a hard time now that the Binance is hacked.
Although Binance is concerned about the stolen funds and will use SAFU to recover the funds, we as it's users should be aware that any exchange can be hacked and shall keep only a limited amount on the exchange.

There was no “hack invasion”. The article says that the hacker got a big number of API and credentials from users by using phishing attacks, virus and other methods. Thus, the big problem wasn’t on the exchange, but on the users. The part which was Binance’s fault is that they couldn’t block the massive withdrawal of 7k BTC before it happened.

[FauxHammer]

There was no “hack invasion”. The article says that the hacker got a big number of API and credentials from users by using phishing attacks, virus and other methods. Thus, the big problem wasn’t on the exchange, but on the users. The part which was Binance’s fault is that they couldn’t block the massive withdrawal of 7k BTC before it happened.

Exactly, but this is what Binance is saying, this is their official statement. I don't have any reasons to distrust them, but such it's very fragile situation. I agree with the fact that they should block this withdrawal or be prepared for it.

[Artemis3]

There was no “hack invasion”. The article says that the hacker got a big number of API and credentials from users by using phishing attacks, virus and other methods. Thus, the big problem wasn’t on the exchange, but on the users. The part which was Binance’s fault is that they couldn’t block the massive withdrawal of 7k BTC before it happened.

Exactly, but this is what Binance is saying, this is their official statement. I don't have any reasons to distrust them, but such it's very fragile situation. I agree with the fact that they should block this withdrawal or be prepared for it.

Phishing and malware are not even Binance's fault. But, the reality might be different.

As for funds still showing, well the thing is you can't move them (in or out). So they may "show" there but that is always true in all bankruns until people actually want to withdraw at the same time. The point of damage control is to calm people so they don't do this, so the bank can cope with the withdraws.

An exchange doesn't really use fractional reserve (or shouldn't) but arbitrarily restricting withdraw does send an alarm, even if everything is fine.

A full reserve bank (or exchange) has never nothing to fear should their clients decide to withdraw. If it is what they claim only 2% is lost and their earnings are well above that then sure no problem. The fear is of course if they are telling the truth, because if the situation IS worse i doubt they would disclose it, precisely to avoid the run.

For the time being everyone has to renew their API keys, trading within the exchange is the only thing you can do for now.

We can only hope they are telling the truth and are not going to pull another nicehash stunt. But the community has every reason to be concerned.

Thankfully the vast majority of the funds are protected on cold wallets, as they should, and only a minuscule fraction (2%) was hot for daily transactions, which is what they claim was stolen.

[mk4]

There was no “hack invasion”. The article says that the hacker got a big number of API and credentials from users by using phishing attacks, virus and other methods. Thus, the big problem wasn’t on the exchange, but on the users. The part which was Binance’s fault is that they couldn’t block the massive withdrawal of 7k BTC before it happened.

Is there something I don't get here? If the stolen bitcoin was from vulnerable user's accounts as they have claimed, why was the withdrawal one massive transaction instead of multiple transactions of varying sizes from multiple wallets/accounts? Am I missing something here?

[TryNinja]

Is there something I don't get here? If the stolen bitcoin was from vulnerable user's accounts as they have claimed, why was the withdrawal one massive transaction instead of multiple transactions of varying sizes from multiple wallets/accounts? Am I missing something here?

To be fair, the tx had 44 outputs to different addresses (that could be 44 different accounts/withdrawals). Maybe the hacker targeted users with a big balance, or something like this. I can’t really know. I don’t even know if what they are saying is true... (I’m giving them the benefit of the doubt here).

[--DarkSecrets--]

rip 7k btc.

Source: https://binance.zendesk.com/hc/en-us/articles/360028031711
TX: https://www.blockchain.com/btc/tx/e8b406091959700dbffcff30a60b190133721e5c39e89bb5fe23c5a554ab05ea

And let's not forget some Words of Wisdom from CZ

"Store coins yourself. You fight hackers yourself, and guard from losing wallet yourself. Computer breaks, USBs gets lost.

Store on an exchange. Only use the most reputable, proven secure, exchanges.

Or move to DEX, disrupt ourselves. https://t.co/Ci4ux9I3VD"

— CZ. Jan 15, 2019

Its nothing new with this one, I am thinking how it happens and even always in the same scenario's where bitcoin pumps hard then all of a sudden hack news or negative news pop's up. I know this is real but, that's a big question to in my mind. Going back to the topic all exchange is vulnerable to hackers no system is safe. Only humans created binance and so we can expect a human knowledge also can enter and disrupt the security of any exchange. Its good only that binance team who manages the backend notice it faster and prevent hackers for stealing more funds inside the exchange.

[mirawantirinjana]

Without reading this forum message. I never would known of the hackings. Then logged into my Binance account, my funds are all sitting still there! 

I also just heard this news from this forum, if I didn't read this maybe I wouldn't know about this news, my question is whether this will affect the price of bitcoin in the next few days?

[Vishnu.Reang]

This is really sad when people already being convince to join crypto but it's still hackable

Hacks are not limited to crypto-currency exchanges. Every day, the bank accounts and credit cards of millions of people get hacked. Obviously these incidents don't get much media limelight, as they are considered as nothing out of the ordinary. Money is not safe if it is stored in third party storage, such as banks (in case of fiat) or crypto-exchanges (in case of BTC).