Hackers Steal $40.7 Million in Bitcoin From Crypto Exchange Binance

[dragononcrypto]

Binance Announcement: https://binance.zendesk.com/hc/en-us/articles/360028031711

We have discovered a large scale security breach today, May 7, 2019 at 17:15:24. Hackers were able to obtain a large number of user API keys, 2FA codes, and potentially other info. The hackers used a variety of techniques, including phishing, viruses and other attacks. We are still concluding all possible methods used. There may also be additional affected accounts that have not been identified yet.

The hackers were able to withdraw 7000 BTC in this one transaction: https://www.blockchain.com/btc/tx/e8b406091959700dbffcff30a60b190133721e5c39e89bb5fe23c5a554ab05ea

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.

The hackers had the patience to wait, and execute well-orchestrated actions through multiple seemingly independent accounts at the most opportune time. The transaction is structured in a way that passed our existing security checks. It was unfortunate that we were not able to block this withdrawal before it was executed. Once executed, the withdrawal triggered various alarms in our system. We stopped all withdrawals immediately after that.

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

We must conduct a thorough security review. The security review will include all parts of our systems and data, which is large. We estimate this will take about ONE WEEK. We will post updates frequently as we progress.

Most importantly, deposits and withdrawals will need to REMAIN SUSPENDED during this period of time. We beg for your understanding in this difficult situation.

We will continue to enable trading, so that you may adjust your positions if you wish. 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.

In this difficult time, we strive to maintain transparency and would be appreciative of your support.

PS, I (CZ) will continue the previously scheduled Twitter AMA in a couple of hours.

- CZ


Hackers Steal $40.7 Million in Bitcoin From Crypto Exchange Binance

Hackers stole more than 7,000 bitcoin from crypto exchange Binance, the world’s largest by volume, the startup reported Tuesday.

Binance announced that a “large scale security breach” was discovered earlier on May 7, finding that malicious actors were able to access user API keys, two-factor authentication codes and “potentially other info,” the exchange’s CEO, Changpeng Zhao, said in a letter. As a result, they were able to withdraw roughly $41 million in bitcoin from the exchange, according to a transaction published in the security notice.

The disclosure comes hours after Zhao tweeted that the exchange was undertaking “some unscheduled server maintenance,” writing that “funds are.” After the disclosure announcement, Zhao tweeted that the exchange would “provide a more detailed update shortly.”

The exchange may not yet have identified all impacted accounts, he said. And according to Binance’s statement, the breach only impacted Binance’s hot wallet, which contains roughly 2 percent of the exchange’s total bitcoin holdings.

“All of our other wallets are secure and unharmed,” he said, adding:

“The hackers had the patience to wait, and execute well-prepared actions through multiple seemingly independent accounts at the most opportune time. The transaction is structured in a way that passed our existing security checks. It was unfortunate that we were not able to block this withdrawal before it was executed.”

The withdrawal triggered internal alarms after it was executed, and Zhao said the exchange froze withdrawals following the discovery. While deposits and withdrawals will remain suspended for the next week, trading will be re-enabled, though he cautioned that “the hackers may still control certain user accounts.”

Binance will conduct “a thorough security review” encompassing its systems and data during the next week.

The exchange will use its Secure Asset Fund for Users (SAFU fund) to cover the loss, which won’t impact users, according to the notice.

The fund consists of 10 percent of all trading fees absorbed by the exchange, and was initially launched to protect Binance’s users “in extreme cases,” according to a previous notice. It is stored in its own cold wallet.

“In this difficult time, we strive to maintain transparency and would be appreciative of your support,” Zhao said Tuesday.

He concluded the note by saying he would participate in a previously scheduled Twitter “ask-me-anything.”

Source: https://www.coindesk.com/hackers-steal-40-7-million-in-bitcoin-from-crypto-exchange-binance

[Zed0X]

While this event is unfortunate, this is a good reminder to everyone that even the top centralized exchanges gets hacked. Everyone should not put so much faith on their security.

[dragononcrypto]

While this event is unfortunate, this is a good reminder to everyone that even the top centralized exchanges gets hacked. Everyone should not put so much faith on their security.

Very true. Truth is I only have faith in cryptocurrency exchanges that have never been hacked, as the chances of an exchange being hacked a second or third time is much more likely than only once it seems. Bitfinex and Bitstamp come to mind. That's me done with Binance, once I can remove my trading coins next week that is 

[tonymillions84]

Yeah you all heard it. it is no longer new and i believed that everyone is aware of how it happened. over 40 millions worth of token was stolen from their cold wallet. important infor to all is to remember to store your crypto in your personal wallet. that is the only way to stay safe.

[sukanyadee]

If Binance said  it's a phishing attack then how did the hackers bypass 2fa? How did they bypass IP address locking/validation? How did they bypass the withdrawal email confirmation? Seems more likely to me that Binance had a vulnerability they don't want to admit to, because it's easier to blame users if it was a "phishing attack" and looks better to the public if it's "not their fault". If it was really a phishing attack then why would they even cover the loss to begin with? It's user’s responsibility at that point. None of this adds up”