Binance reports security incident with $6.3 billion impact

Binance, a cryptocurrency exchange which calls itself a leading blockchain ecosystem, has said that it has faced a security incident with an estimated total impact of $6.3 billion.

“We have worked with blockchain partners to freeze affected assets, with ~$3 billion frozen on-chain so far,” the crytocurrency exchange has said in a statement.

Precautionary measures have led the exchange to: temporarily suspend deposits and withdrawals while security checks are completed; revoke the affected address authorisation; and engage law enforcement and blockchain intelligence partners to trace and recover funds.

The incident involves a compromised engineer’s laptop, which allowed an attacker to gain access to a service container and submit unauthorised withdrawal transactions.

Binance, which has no fixed physical headquarters, was formed by Chinese founders and is regulated by the Financial Services Regulatory Authority (FSRA) of the Abu Dhabi Global Markets (ADGM).

In India it lists its operations through Nest Exchange (formerly known as Nest Services), an offshore reporting entity registered with the Financial Intelligence Unit in India.

The exchange has said that it will share a detailed technical post-mortem once the investigation is complete and the facts are fully verified.

It plans to cover all losses from a SAFU fund and the company’s funds and it will publish an updated Proof of Reserves once remediation is complete.