On May 7th 2019, one of the world most reputable cryptocurrency exchange Binance, experienced security breach with about 7,000 BTC that is worth over $40 Million stolen, Cointelegraph reported.
According to the report, the hackers gained access to large number of 2FAs and APIs which enables them to make the withdrawals.
Binance at press time said, there was one affected transaction, where hackers were able to withdraw 7,000 bitcoins (BTC) worth $40,705,000.
Changpeng Zhao the CEO of the exchange states on Binance website that the bitcoins were withdrawn from its hot wallets, which contain only 2% of the exchange’s total bitcoin holdings. But Binance other wallets are not affected.
Binance will suspend all deposits and withdrawals while it conducts a security review on its systems, which can take up to one week. Trading will still be active and traders will be able to adjust their positions. Zhao states:
“Please also understand that the hackers may still control certain user accounts and may use those to influence prices in the meantime. We will monitor the situation closely. But we believe with withdrawals disabled, there isn’t much incentive for hackers to influence markets.”
The CEO also added that he will conduct a Twitter AMA in a couple of hours to field questions from the community.
Binance will use its Secure Asset Fund for Users (SAFU) to cover the incident. The exchange created the fund in July 2018 as a type of emergency insurance. Binance allocates 10% of its total trading fees to finance SAFU.