Binance Hacked: Crypto Exchange Loses 7,000 Bitcoin (BTC), Shuts Down Withdrawals and Deposits

Leading crypto exchange Binance says hackers have stolen 7,000 Bitcoin worth $40.5 million.

“We have discovered a large scale security breach today, May 7, 2019 at 17:15:24 (UTC). 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.”

Binance says the stolen Bitcoin was removed from the exchange in a single transaction from its BTC hot wallet. According to the exchange, all of its other wallets are secure.

“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 says it will use its Secure Asset Fund for Users (SAFU) to cover any losses and reimburse customers. Right now, users can still log in and trade, although deposits and withdrawals are disabled.

“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.”

Binance CEO Changpeng Zhao says he still plans to host a previously scheduled ask-me-anything, which is set to begin around 8:00 PM PST.

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