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Hacking Binance: 7,000 BTC stolen from a hot wallet of Cryptocurrency Exchange

Wednesday, 08 May 2019

One of the largest cryptocurrency exchanges, Binance, reported a burglary, as a result of which hackers were able to obtain some user data and withdraw 7,000 BTC from the hot wallet of the exchange.
The official report says that the attackers managed to get hold of a significant number of API-keys of users, as well as codes of two-factor authentication. Perhaps they were able to obtain other user data.

"The hackers were able to withdraw 7000 BTC in one transaction. The above transaction is the only affected transaction. It impacted our BTC hot wallet only (which contained about 2% of our total BTC holdings). All of our other wallets are secure and unharmed,"
said the official statement of the company.

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

Binance representatives stressed that the attack was well planned, and the time was chosen very well. Hackers used several initially unrelated accounts, and the transaction was structured so that it passed all security checks. The security system raised the alarm after the withdrawal.

The exchange intends to analyze all parts of its security system, but this will take about a week. All deposits and withdrawals during this time will be suspended. However, the trade will not be suspended, so users can continue their operations.

"Not the best of days, but we will stay transparent. Thank you for your support!," Changpeng Zhao, the head of the exchange, wrote on Twitter.

Representatives of the company stressed that all losses would be covered from the reserve fund of the exchange. Note that 7,000 BTC at the current exchange rate is about $ 41 million.

Earlier it was reported that the losses of the cryptocurrency industry in the first quarter of 2019 amounted to $ 1.2 billion. This amount includes $ 190 million lost by the QuadrigaCX exchange: after the owner's death, it turned out that no one else had access to the keys of the cold wallet of the exchange.

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