How exchanges treat the stolen Money?

[HerbertMarcel]

I am curious to know, how Exchanges treat the stolen money or hack money? Are they really aware of it? Just think, your fund has been hacked and transferred from your wallet to another wallet and then it's deposited to an exchange. If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

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[sikke]

I am curious to know, how Exchanges treat the stolen money or hack money? Are they really aware of it? Just think, your fund has been hacked and transferred from your wallet to another wallet and then it's deposited to an exchange. If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

What proof do you have in terms of actually proving that the funds involved are the exact funds that you got hacked for?

It's all 'he she, she said'. Unless you have rock solid proof I think it's unreasonable to assume that exchanges will freeze someone's account in particular just because someone complained that he/she may be the hacker/scammer behind a fraud.

Of course, you could try, but I doubt the outcome will be positive.

[BlackFor3st]

I am curious to know, how Exchanges treat the stolen money or hack money? Are they really aware of it? Just think, your fund has been hacked and transferred from your wallet to another wallet and then it's deposited to an exchange. If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

Of course the other exchange is not responsible for it instead the exchange where your money has been stolen or hacked is the one responsible for it. The same on what happened to Binance as they lost a huge amount due to leak of their security in short they were being hacked so what they did is they replace all the money that were being stolen by the hacker.

After that, I am not really sure on what is the move of Binance but what I am sure it they were not able to get back their hacked money. That is how the crypto society work.

[ecnalubma]

For sure stolen funds normally goes in and out of Binance however no exchanges can detect whether those funds are stolen, but they can only flag stolen funds that are huge with questionable source but for smaller funds consider no chance.

[_IRMAN]

I am curious to know, how Exchanges treat the stolen money or hack money? Are they really aware of it? Just think, your fund has been hacked and transferred from your wallet to another wallet and then it's deposited to an exchange. If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

If your money is hacked and then deposited into an exchange of course the exchange will not be held responsible because it is not their fault but your own fault

[Fundamentals Of]

I am curious to know, how Exchanges treat the stolen money or hack money? Are they really aware of it? Just think, your fund has been hacked and transferred from your wallet to another wallet and then it's deposited to an exchange. If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

It depends on the particular case. There was a time when Binance and a few more exchange froze the accounts of certain people because it was believed to be the accounts where hackers are sending their stolen Bitcoin. This applies especially when large amounts are involved and there is enough information reaching the heads of the exchanges that there could be a stolen Bitcoin deposited in their exchanges. But in terms of small amounts, I think it is more difficult for them to act on them, more so because of the lack of hard evidence.

[goaldigger]

I am curious to know, how Exchanges treat the stolen money or hack money? Are they really aware of it? Just think, your fund has been hacked and transferred from your wallet to another wallet and then it's deposited to an exchange. If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

If you got hacked then it will be hard to get it back and even exchanges can't help you to get it back. They are responsible on securing your funds while on your wallet but if you fail to protect your wallet details on your side, then it will be hard for exchanges to help you and it will be hard to defend to them that hackers really  got your money, any proof that you submitted is still subject for investigation. If you are not confident with your exchanges right now, then use the top exchange and still protect your money on your own.

[ajiz138]

if there is authentic evidence that your funds were stolen and hacked by someone else and transferred to the Exchange, it might work. But it is very difficult to prove that, it's your own fault and even the Exchange will not interfere with the theft that occurs outside their platform. You must take care of your own wallet because it is your responsibility, if a loss occurs it will be difficult to restore it even impossible anymore.

[shinratensei_]

I am curious to know, how Exchanges treat the stolen money or hack money? Are they really aware of it? Just think, your fund has been hacked and transferred from your wallet to another wallet and then it's deposited to an exchange. If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

They will freeze it in the wallet until there is more discussion about that, i just know some exchange sites are halting the stolen funds and if the exchange site knows where is it coming from and then they will try to give it back. In some cases, exchange sites are not returning the stolen funds.

Remember the owner must do a lot of verification to get back their money or sometimes they will create a report to the regulator about that. You have need to prove with a lot of documents and proof to get back your money.

This is a long process to do.

[TheClownSong]

I am curious to know, how Exchanges treat the stolen money or hack money? Are they really aware of it? Just think, your fund has been hacked and transferred from your wallet to another wallet and then it's deposited to an exchange. If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

Some exchangers blacklist deposits from wallet addresses that are indicated to have originated from hacking. This is a good step because it can isolate hacked tokens or coins so that hackers find it difficult to sell and in the end they give up to do it again.

[lighpulsar07]

Well it depends on huge amount of bitcoin/altcoin stolen they usually ignore it if the amount of stolen money or cryptocurrency unless if the original owner of that money warned the exchanges to block the wallet address to deposit in the site, and if the huge amount of money was stolen ie like what happened to bitfinex the exchanges will not let through this kind of transactions. Although hackers will sell it on underground instead of legal exchanges since they will comprimised their identity.

[niisarearning]

If somebodies wallet hacked means their private key is compromised . That mean both are holding private keys . Here we have to remember proof of keys concept . Who is having the key of wallet he will be the owner . For small amount or individual wallet hack nothing can be done . Even big exchange hack only couldnt able to help out . So  in crypto space we are responsible for our private keys . Exchange cant help  it seems . Even peopel are selling wallet for fiat currency nothing can be proved once your private key compromised

[zulfi125]

First of all, you should add 2FA in any exchange for security reasons so that 2FA can protect your account but if your phone hacked than 2FA can't protect you, in some cases, mobile was hacked and 2FA also hacked. If your funds were stolen and transfer to another wallet than exchange will not responsible this stolen may be for your negligency. 

[Drai]

If a hacker is smart enough to hack your wallets and steal your funds, don't you think they would be smart enough to liquidate that find without being caught? They would probably just deposit the funds in an exchange and withdraw it almost immediately, making it untraceable before the exchange would even have the chance to know about it, anybody can open an exchange account, infact a single person can open hundreds of accounts and operate them from the same device.

[bitsurfer2014]

If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

Most probably exchanges will not do any action even if you claim that the assets are yours because if they do so, this policy would be subjected to abuse.

Imagine a regular user depositing 10BTC to Binance and a malicious person could very well froze that assets if he claims he's the original owner of it and it was stolen! This scenario won't be good for an exchange business because no one will ever use it if he knows his funds could be frozen anytime by just a simple claim of ownership from somebody else.

In the first place, its our duty to safeguard our funds so that we will not face such issues - trying to recover lost funds within an exchange which I think would be futile.

Though I guess, this will not be always the case and that if you could produce a court order to freeze that account's assets, then I think that exchange would heed to that order but it would still be subjected for litigation and could be contested which could also be a long and tedious process. Imho.

[mu_enrico]

If the thief is stupid enough not to use tumbler services, the exchange could freeze the account (with its balance). Moreover, exchanges usually have an alert system and mechanism to wait for some more confirmation for withdrawal. It gives them a sufficient window (time) to make sure no problem for the withdrawal, as mentioned earlier.

But usually, the stolen fund will first "washed" through tumbler services, or dealt over the counter (OTC). So "mainstream" exchanges could not do anything except standard KYC/AML practice.

[the rise]

if there are errors from users about some level of exchange security that is not being used, then they will not do anything, this is already included in the terms and conditions. However, if the hacks occur on the core exchange system, so far they have carried out a backup and maintenance process between hot and cold wallets, they ensure that user funds are not reduced at all with a fast refund program.

[TGD]

I am curious to know, how Exchanges treat the stolen money or hack money? Are they really aware of it? Just think, your fund has been hacked and transferred from your wallet to another wallet and then it's deposited to an exchange. If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

Most of the hacker used Bitcoin Mixer Services to loss track of the hack BTC or other cryptocurrency. They are smart enough to do that and I believe this is basic from them. So exchange will never determine if BTC came
from hackers or not and also hackers usually sold there BTC over the counter or in deepweb. They will never sell there hack BTC to a place that might gonna exposed there privacy itself.

[Yaunfitda]

I am curious to know, how Exchanges treat the stolen money or hack money? Are they really aware of it? Just think, your fund has been hacked and transferred from your wallet to another wallet and then it's deposited to an exchange. If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

Sad to say that exchanges will not act on any 'supposedly' stolen money. I mean how can you give them proof that it was stolen in the first place? Sad to say that they won't act on it.

And just imagine if everyone will complain about it, then how will exchange treat the case. I guess this is one drawback of this market, it's free and open, just saying.

[SolarWindMiningCompany]

I am curious to know, how Exchanges treat the stolen money or hack money? Are they really aware of it? Just think, your fund has been hacked and transferred from your wallet to another wallet and then it's deposited to an exchange. If you claim to the exchange about the money, Are they not responsible for taking necessary action? What do you think?

What proof do you have in terms of actually proving that the funds involved are the exact funds that you got hacked for?

It's all 'he she, she said'. Unless you have rock solid proof I think it's unreasonable to assume that exchanges will freeze someone's account in particular just because someone complained that he/she may be the hacker/scammer behind a fraud.

Of course, you could try, but I doubt the outcome will be positive.

In some cases of a theft or unwise hack, for example 7m tokens worth millions of dollars is stolen from a project developer Wallet might be transfered to Binance to be sold immediately, if Binance got wind of the information, the either suspend deposits or freeze deposits. In most cases the indices can easily be calculated in huge volume transactions but them cryptocurrency decentralisation makes it uneasy most times