BINANCE - BIGGEST HACK EVER, $6.3 BILLION WORTH OF ASSETS STOLEN [UPDATED]

[EL MOHA]

I do not think this would happen. I'm sure Binance will be anticipating a massive withdrawal request when withdrawals resume and should be prepared for it. So I do not expect their system to crash. Rather, I would expect the withdrawal process to be a bit slower than what it used to be because of the massive withdrawals request.

That’s why the withdrawal is in batches and also has a time frame which will help the exchange to process the transactions smoothly, there are few chains or network that they have enabled withdraw for and I read others will follow which is a good step if you ask me.

I do not think this will cause any major network congestion on most of the networks most importantly bitcoin since withdraw from the exchange will be actually batched plus it’s not like everyone on crypto space are having their funds on the exchange. I also think not so many of people will even withdraw their funds away from the exchange at the moment they would most likely still leave their funds there something I am seriously warning against.

Take money to self custody and stop been deceived by SAFU

[stompix]

People will get compensated if there are enough to trust CZ with this and lend him the money in deposits; if not...funds are GOONIES!

As things stand, that's not at all questionable - even in this thread I read defenses and justifications for what happened. Those who think it is normal to store so much value in a hot wallet and clearly have no protective mechanisms are living in a great delusion that they are SAFU.

I had a discussion with someone, a 7-year-old account, who was sure that you can store seed phrases online in your "secured" account and that storing coins on exchnges is safer than storing coins in your own wallet.
So, yeah, this world and Binance will never run out of fools funding their operations.

For anyone wanting to track outflows from Binance in the next few days there's a good resource: https://defillama.com/cexs
!
$1.263 billion worth of funds have already left Binance in the last few hours.

Those are misleading metrics.
They only track addresses they know of, so if Binance moves 100 BTC to a new cold wallet of their till they label that one as thei wallet it will be seen as outflow.
Also, Binance has stopped using their hot wallet bc1qm34lsc65zpw79lxes69zkqmk6ee3ewf0j77s3h and is funding two new addresses, probably for withdrawals, none are labeled yet, not even by Arkham.

[AndrewWeb]

Those are misleading metrics.
They only track addresses they know of, so if Binance moves 100 BTC to a new cold wallet of their till they label that one as thei wallet it will be seen as outflow.
Also, Binance has stopped using their hot wallet bc1qm34lsc65zpw79lxes69zkqmk6ee3ewf0j77s3h and is funding two new addresses, probably for withdrawals, none are labeled yet, not even by Arkham.

5 BTC was transferred to that wallet yesterday

https://www.blockchain.com/explorer/addresses/btc/bc1qm34lsc65zpw79lxes69zkqmk6ee3ewf0j77s3h

Maybe to see what happens ?

[Rikafip]

And when withdrawal resumes, people will withdraw their funds in droves, what happened might likely crash Binance customer base, because trust has been los

Trust lost? Even here (where people are generally better informed than the average crypto enthusiast), I've seen people congratulating Binance on how they handled this case etc.

I mean, if the failures of other exchanges in the past, like Mt Gox and FTX didn't teach people anything, why would this recent hack? Especially since none of Binance customers will lose any money. If anything, it might make some people trust Binance even more than before, now that they saw them surviving 6 billion USD hack.

[sergiorus]

Those are misleading metrics.
They only track addresses they know of, so if Binance moves 100 BTC to a new cold wallet of their till they label that one as thei wallet it will be seen as outflow.
Also, Binance has stopped using their hot wallet bc1qm34lsc65zpw79lxes69zkqmk6ee3ewf0j77s3h and is funding two new addresses, probably for withdrawals, none are labeled yet, not even by Arkham.

Binance themselves confirmed the numbers:

Between 06:00 and 15:30 UTC on November 1, we processed $4.649 billion in withdrawals and $1.01 billion in deposits, resulting in a net outflow of approximately $3.64 billion.

Source: https://x.com/binance/status/2116926305254133892

[Sticky Bomb]

And when withdrawal resumes, people will withdraw their funds in droves, what happened might likely crash Binance customer base, because trust has been los

Trust lost? Even here (where people are generally better informed than the average crypto enthusiast), I've seen people congratulating Binance on how they handled this case etc.

In my neighborhood, people trusted that Binance would be back since they're big and Binance kept their word, so I think the reverse would even be the case. Less informed and foolish people would be inclined to have more confidence in Binance as they bounced back and not withdraw their funds.

A lot of people on this space are too lazy to practice self-custody and Binance is a big name they'll trust easily. No matter what happens, most people would never learn and move to non-custodial wallets. They're comfortable risking possible loss of their funds for comfort.

[Dogedegen]

Everything has its own risk and tradeoffs, custodial, non custodial. CEX, ETF, hardware wallet, airgap, whatever. So we need to be careful how we word advice and concerns.

I want to know what are the risks of ETFs? Can we lose money? Narrative in X only securely stores bitcoin in ETFs.

Yes, you can, too, and in a number of ways. In the first place, your Bitcoin is under the custody of a third party. Is it impossible for the funds to get compromised? Of course, not.

And then there's also the issuer and the broker, which could also get into problems. That could also result into you not having access to your funds.  

Moreover, the good thing with the likes of Binance is that withdrawal, deposit, and trading are available 24/7. If there are some big news, market development, or whatever that you think may massively affect the price or would cause a huge swing, you can deposit, trade, or withdraw right away. You can't do that with your ETF. All you can do is monitor the price helplessly and wait for the trading hour or day to open to actually do something, which could be too late already.

He pretty much coverts it. Anyway you can't even be sure that your BTC exist when they are in an ETF, it might be even a bit worse than exchanges on that part. So you are making an exchange of risks, where you drop the risk relating to self-custody and having to deal with security by transferring it a third party, and in exchange you lose the golden values that Bitcoin provides "don't trust, verify". But after everything that has happened this year, I really can't blame a single person that is not very good with technology in keeping their coins in a regulated ETF. When it comes to insurance and the risk of going bust, it is always going to be better to keep your Bitcoin in an ETF than some exchange.

Those are misleading metrics.
They only track addresses they know of, so if Binance moves 100 BTC to a new cold wallet of their till they label that one as thei wallet it will be seen as outflow.
Also, Binance has stopped using their hot wallet bc1qm34lsc65zpw79lxes69zkqmk6ee3ewf0j77s3h and is funding two new addresses, probably for withdrawals, none are labeled yet, not even by Arkham.

Binance themselves confirmed the numbers:

Between 06:00 and 15:30 UTC on November 1, we processed $4.649 billion in withdrawals and $1.01 billion in deposits, resulting in a net outflow of approximately $3.64 billion.

Source: https://x.com/binance/status/2116926305254133892

Sounds like a reasonable amount of outflows. Usually it is the people that respond emotionally to an incident like this that get hacked or lose money in the next exchange. That is how many people lost money with FTX. They had it safe and secure in good places like Binance and Coinbase, and chasing the new exchange led to a complete disaster.

[Stalker22]

And when withdrawal resumes, people will withdraw their funds in droves, what happened might likely crash Binance customer base, because trust has been los

Trust lost? Even here (where people are generally better informed than the average crypto enthusiast), I've seen people congratulating Binance on how they handled this case etc.

I mean, if the failures of other exchanges in the pas, like Mt Gox and FTX didn't teach people anything, why would this recent hack? Especially since none of Binance customers will lose any money. If anything, it might make some people trust Binance even more than before, now that they saw them surviving 6 billion USD hack.

"The devil you know" is basically what this whole circus comes down to.

To be honest, a $6 billion hack event that leaves people in no worse financial shape is really good PR even if we dont want to admit it.  Usual people dont give a damn about decentralization or security as they care about the amount in their account being the same when they wake up and log in on a random tuesday morning.

[blockman]

A lot of people on this space are too lazy to practice self-custody and Binance is a big name they'll trust easily. No matter what happens, most people would never learn and move to non-custodial wallets. They're comfortable risking possible loss of their funds for comfort.

Not only lazy to take self custody seriously but also to do withdrawals when these incidents happen. They are putting the trust on this safu thing even if they should start making themselves more confident in holding their own assets instead of relying it to Binance or with any other exchanges. They're too confident with the security that binance has got despite this hack and that's an actual laziness there that they're not willing to move out their assets and protect it on their own.

Take money to self custody and stop been deceived by SAFU

Safu is no longer safe. But they'll continue to put their assets in it and won't be moved to withdraw even as the withdrawals are allowed.

[Rikafip]

To be honest, a $6 billion hack event that leaves people in no worse financial shape is really good PR even if we dont want to admit it. 

It is, if you are naive, or idiot. 

Usual people dont give a damn about decentralization or security as they care about the amount in their account being the same when they wake up and log in on a random tuesday morning.

That's true, an average crypto investor doesn't give a fuck about anything that bitcoin stands for, and I am pretty sure that 99% never even bothered to read whitepaper. Those are kind of people that treat centralized exchanges like banks and are getting rekt every once in a while.

[Emjay24]

The timeline given by Binance in their email direct align with their X posts, they stated withdrawals would be restored in 48 hours, replied 45 hrs to an X user in the morning but their email carries' over the next few days". I think withdrawals might take longer.

Here's the email extract

What you'll hear from us next

We're committed to keeping you updated on three things over the next few days:

Withdrawal status: as soon as service is safely restored.

Our full incident report: a detailed technical post-mortem, published once the investigation is complete and every fact is verified.

Proof of Reserves: published after remediation, so you can verify for yourself that no user balance was affected.

Amazing response, and this is what I am talking about. They should be applauded and thanked for being like this, rather than looking for sneaky ways to criticize them in areas where they are weak when they are down. This is how every company in this space should behave, many omit as many details from the cases as long as possible to the public. Others even completely try to hide that they have been hacked if it is possible at all, this happens in traditional industries a lot too. Binance is much richer than many people want to admit..

I'm never a big fan of exchanges, but I really applaud how Binance handled this situation with unwavering maturity, they never left their clients in the dark and made sure they provided timed updates to them.

However this is not enough reason to continue trusting a third party, what happened should be considered a warning and people should go for self-custody wallets. The coins you've in your exchange account isn't actually yours. #NOT YOUR KEYS NOT YOUR COIN

[rdluffy]

...
And when withdrawal resumes, people will withdraw their funds in droves, what happened might likely crash Binance customer base, because trust has been lost, and for anybody to want to keep his crypto asset in binance, that person will be doing that at owner's risk and with the mindset that anything can happen which is not a good PR for a platform that serve as a custodian for people's assets.

Interestingly:



That’s not what happened or what’s happening

It seems to me that the fear of losing crypto in one’s own custody is greater than the fear of leaving it on Binance
After so many hacks and exploits, it seems that many people trust the exchange more

[salad daging]

...
And when withdrawal resumes, people will withdraw their funds in droves, what happened might likely crash Binance customer base, because trust has been lost, and for anybody to want to keep his crypto asset in binance, that person will be doing that at owner's risk and with the mindset that anything can happen which is not a good PR for a platform that serve as a custodian for people's assets.

Interestingly:



That’s not what happened or what’s happening

It seems to me that the fear of losing crypto in one’s own custody is greater than the fear of leaving it on Binance
After so many hacks and exploits, it seems that many people trust the exchange more

It would not be strange, there are still many people trust exchanges to store their crypto.

Bybit hacked $1.5 B - user funds are safe.
Bitget hacked $387M - user funds are safe.
Binance hacked $6.3B - user funds are safe.

This is maybe people start to think that storing on the exchange is still safe, their fear has faded, even Binance says 98% still live aka trust.

Hmmm, we will never store on an exchange with a lot of assets.

[alani123]

...
And when withdrawal resumes, people will withdraw their funds in droves, what happened might likely crash Binance customer base, because trust has been lost, and for anybody to want to keep his crypto asset in binance, that person will be doing that at owner's risk and with the mindset that anything can happen which is not a good PR for a platform that serve as a custodian for people's assets.

Interestingly:



That’s not what happened or what’s happening

It seems to me that the fear of losing crypto in one’s own custody is greater than the fear of leaving it on Binance
After so many hacks and exploits, it seems that many people trust the exchange more

It would not be strange, there are still many people trust exchanges to store their crypto.

Bybit hacked $1.5 B - user funds are safe.
Bitget hacked $387M - user funds are safe.
Binance hacked $6.3B - user funds are safe.

This is maybe people start to think that storing on the exchange is still safe, their fear has faded, even Binance says 98% still live aka trust.

Hmmm, we will never store on an exchange with a lot of assets.

Don't sleep on that.
Maybe the exchange holds a leveraged position on some of its assets, essentially filling holes in its books by loaning against funds they're holding. But if BTC or the whole crypto market goes down and their leveraged position gets liquidated, good luck filling the books then. This hole could show you years later. Just like ftx was operating for years without issue but their whole platform collapsed on a minor mishap.

[sergiorus]

...
And when withdrawal resumes, people will withdraw their funds in droves, what happened might likely crash Binance customer base, because trust has been lost, and for anybody to want to keep his crypto asset in binance, that person will be doing that at owner's risk and with the mindset that anything can happen which is not a good PR for a platform that serve as a custodian for people's assets.

Interestingly:



That’s not what happened or what’s happening

It seems to me that the fear of losing crypto in one’s own custody is greater than the fear of leaving it on Binance
After so many hacks and exploits, it seems that many people trust the exchange more

The outflows keep coming by the way. But that's not really that important. There were fears of a really massive bank run that could put the whole existence of the exchange at risk but that hasn't happened and obviously won't happen at this point.

What becomes really important now is to track the spot and perp volume dominance. Exchanges don't make money from holders, they make it from traders.

If the money that's left Binance, even if it's not that much, was money of the most active traders, then Binance's revenues may take a hit. Eventually leading to the loss of domination.

[OmegaStarScream]

What's everyone thoughts on the current situation with Thornode operators, or Thorchain in general after the FBI's statement[1]? The trading has been paused due to a refund error [2] but they'll obviously be the center of attention once they're live again.

Do you think this could end up in sanctions, CEXes blacklisting thorchain's vaults, etc.?

[1] https://x.com/FBICyberBranch/status/2116660730745299426
[2] https://thedefiant.io/news/defi/thorchain-swaps-remain-paused-on-12-chains-after-reported-refund-error

[Dogedegen]

"The devil you know" is basically what this whole circus comes down to.

To be honest, a $6 billion hack event that leaves people in no worse financial shape is really good PR even if we dont want to admit it.  Usual people dont give a damn about decentralization or security as they care about the amount in their account being the same when they wake up and log in on a random tuesday morning.

That is a good way to put it, and sadly many people don't understand that. That is why they would trust new exchanges or exchanges that have been suffered a large hack and recovered than those that didn't. This is why many such people lose money in custodial platforms. They keep going to the unknown devil for one reason or another, when the devil you know has always been there and has been proven to be reliable.

I'm never a big fan of exchanges, but I really applaud how Binance handled this situation with unwavering maturity, they never left their clients in the dark and made sure they provided timed updates to them.

However this is not enough reason to continue trusting a third party, what happened should be considered a warning and people should go for self-custody wallets. The coins you've in your exchange account isn't actually yours. #NOT YOUR KEYS NOT YOUR COIN

Your post was good until you wrote something that logically does not follow and is false. This is not a warning that people should go for self-custody wallets any more than the Ledger hack was a warning for people to go to custodial wallets and stop doing self-custody. I have already explained that we need to stop giving this false advice, self-custody is not a perfect solution and it is not for everyone.

The outflows keep coming by the way. But that's not really that important. There were fears of a really massive bank run that could put the whole existence of the exchange at risk but that hasn't happened and obviously won't happen at this point.

What becomes really important now is to track the spot and perp volume dominance. Exchanges don't make money from holders, they make it from traders.

If the money that's left Binance, even if it's not that much, was money of the most active traders, then Binance's revenues may take a hit. Eventually leading to the loss of domination.

There is no chance of that. People are very addicted to these kinds of paranoiac negative news, it comes from years of reading posts on platforms like X that only fuels negative pattern thinking. Guys go touch some grass, stop reading social media. It would take you several months of digital detox to have any chance to stop thinking this way, whoever is affected. A few days break does not work after you've been brainwashed for years or decades depending on the user age.