Binance-hacker-1029 – $5.6B stolen from Binance
arkm.com841 points by Tiberium 6 hours ago
841 points by Tiberium 6 hours ago
Their insurance fund (SAFU) is completely wiped out, it's only $1 billion in BTC: https://www.binance.com/en/academy/glossary/secure-asset-fun...
The name of the fund was originally inspired by this meme: https://www.youtube.com/watch?v=DelF6zEHXpE
FWIW, at the end of every crypto bear market, a CEX usually blows up (eg FTX)...
Top post on /r/cryptocurrency Good to see all these organic posts across social media.
MelangeBot OP • 2h ago Their insurance fund (SAFU) is completely wiped out, it's only $1 billion in BTC
The name of the fund was originally inspired by this meme
FWIW, at the end of every crypto bear market, a CEX usually blows up (eg FTX)...
> As of 2026, the SAFU fund comprises crypto assets valued at approximately US$1 billion, held entirely in Bitcoin
And decreasing, since BTC is dropping as we speak. Always a good idea to hedge a currency with the currency itsself
> And decreasing, since BTC is dropping as we speak. Always a good idea to hedge a currency with the currency itsself
Depends on what you’re insuring, no? For theft, it actually makes senses, right? That way, you’re insuring a constant number of coins, no matter what the market is doing. If you’re insurance currency would tank during a bitcoin heist, you would lose the insurance effect.
Stablecoins are frozen so the hole will likely be around two billion dollars.
Binance has equity and cash flow cover this, outside the insurance fund.
They custody $150B.
FTX was larger in dollar terms and ecosystem was smaller back in a day.
they borrowed ETH against the stablecoins on AAVE before they were frozen
This might sound good.. but freezing currencies is bad. It evaporates trust of liquidity from whoever is doing governance. It's part of the reason why the bond market is doing what its doing lately and why countries are on-shoring gold reserves.
That sounds kind of ideal, but I feel like their actions might have been justifiable.
If a massive heist like this triggered a run on one of the largest exchanges (Binance), potentially leading to a liquidity crisis, the consequences for the ecosystem could be far worse than temporarily freezing specific addresses holding stolen stablecoins.
Not saying that's what would have happened, but it seemed like a real possibility. And I'm not saying freezing assets is good in general, but in this particular case, maybe it was the lesser evil.
governments freeze currency all the time.
Only the shithole countries freeze currency trading. That doesn't happen with actual reserve fiat currencies.
The primary reserve currency does it all the time. https://ofacblockedfundslawyers.com/us-sanctions-freeze-doll...
That's different. They freeze individual accounts subject to legal orders. They don't freeze the whole currency.
Well maybe it could happen with actual reserve currencies, but it certainly doesn't happen with platinum level, diamond tier luxury fiat currencies.
Oh you didn't know? I bet you trade in "dollars". That's cute.
Uh don’t you not want to cover losses with customer funds?
> Changpeng Zhao (CZ), former CEO of Binance, tweeted "Funds are safe"
Seems like the issue here is that he became former CEO. Funds are not safu without him...
Wait. How does the insurance fund run significantly lower than the primary?
Do you mean bull market?
It's a (weak) bear market capitulation signal - max fear when people think everything is broken.
It seems like bitcoin, currently 78719, was only 58526 on 30 June. That's 34.5% up in four months, meeting the definition of bull market.
Bitcoin is volatile enough you can cherry-pick pretty much any %age you want based on the dates you choose. Which you seem to have done here - "happening" to choose the day with the lowest single day value in the last 3 years for your comparison point.
For another narrative, it was 83,038 a month ago on Sept 29th, so is down 5% in one month. And one year ago it was 112,562 on Oct 29th 2025 - down over 30% in one year. Well into "bear market" territory.
Using "traditional" market indicators and definitions for things like bear/bull markets doesn't feel sensible for such a volatile market.
Fine, but the comment "It's a (weak) bear market capitulation signal" is inapplicable, either because defining bear/bull markets doesn't feel sensible, or because it's not currently in the capitulation stage of a bear market, but some way off the bottom.
But when FTX blew up crypto went down even further..
much more was at risk as a percentage of market size, market was in worse shape,
Though in that case the crash was directly due to "effectively altruist" SBF fraudulently dumping customer assets in a half-brained and presumably stimulant-addled attempt to manipulate the market and reduce his liabilities.
Not making any market predictions here-- just saying that it's probably not that useful to generalize from that event.
I think the point is more that when something bad happens in markets it creates fear, which generally leads to downturns (for at least some time).
The insurance fund is not for covering hacks.
Binance is making so much money, covering this hack is peanuts for them.
Not to be too pedantic, but with some napkin math, I don't think this is true. Looking for clarification!!
I downloaded Binance's self published market data (https://data.binance.vision/), calculated spot and futures volume for the past year, and then applied their *highest fee tier* on both sides of the volume (for every $1 traded, they generate a fee on the taker and the maker. the fee rate is asymmetrical).
Spot revenue worked out to $7.6B USD, perps revenue worked out to $13.8B
This is an upper bound on the fees charged on volume. Binance also scams their users with a b-book, has DMM deals, etc.
I don't want to get into all that today.
But the final result is that they print somewhere in the range of $20B per year on fees. I guess CZ also has huge stockpiles of BTC and stuff. A 1% rise in BTC price probably means more for them than their actual fees, LOL.
All this to say, I think $5.6B significantly hurts.
See Google's stock price today. Their ads business slowed down a bit, and their stock tanked 10%. If binance was publicly traded, I imagine a similar affect would be demonstrated on their price.
How much money do you think they are making? Because I really doubt this is peanuts to them.
Binance has a market cap just shy of $100B, so a $5.8B sure hurts, but it’s not a showstopper I’d say.
A market cap predicated on the price of bitcoin. A market cap is not funds available, it's just the valuation of the market, which is fickle.
boss: did you just send $5B of our company's liquid capital to a nigerian prince?
me: no worries boss, our market cap is $100B
boss (who is also the tooth fairy): oh right cool np
It really hurts when there's this much misunderstanding of market cap vs. revenue. P/E ratios exist for a reason.
About $2.4 billion out of this is already frozen by Circle and Tether. Some of the big ones:
- 971.15M USDT (Ethereum): https://etherscan.io/tx/0x7baba482077843514d9c72bac0110ba091...
- 823M USDC (Ethereum): https://etherscan.io/tx/0xc954c86f118e8e410e6a3eb9e3b38ff4a9...
- 312.73M USDT (Tron): https://tronscan.org/#/transaction/71b0ec0fe873fe820c37cc3ec...
- 175M USDT (Ethereum): https://etherscan.io/tx/0x0c07a5e428ce233a3bcb40f257ad899594...
If your crypto was stolen in this, atleast you can rest assured that your money will be put to good use. In North Korea that is, by the military. I'm sure at this point Kim himself has Bitcoin merchandise with how often they make massive heists
If your crypto was stolen in this, it wasn't your crypto. It is simply cryptocurrency that has been reallocated from an exchange to a more competent party, as the free market intended.
I don't think the security trade-off for most people is clear here.
Given things like the ledger hardware attack[1] I think the time indexed risk of using a centralized exchange is probably lower than doing self-custody.
I understand that many people do self-custody for philosophical reasons, but I think trying to disguise this as a security decision ("If your crypto was stolen in this, it wasn't your crypto.") is arguable at best.
[1] https://www.ft.com/content/70f69253-6017-4259-95c9-48bf0e088...
So what happened with all of those with hardware wallets that have been pwned?
There apparently is no such thing as “your crypto” with how many security problems there are.
By the nature of blockchain, it's never, ever your crypto. It's allocated to whichever bucket the majority of participants in a given network agree to allocate it to.
Well, not exactly. A malicious majority of miners could rewind the chain as they please. They could indirectly steal some funds by undoing certain transfers, but they couldn’t just directly reassign funds to themselves.
Has anyone calculated the mining capacity of the AI data centre buildouts? Presumably the big firms could out-mine mining firms if they chose to?
Absolutely not, as GPUs used in data centers cannot compete with ASICs designed specifically for Bitcoin mining.
The Bitcoin mining network is somewhere around 1000 EH/s, while the (AI assisted research ahead) 34.5 million H100-equivalent GPUs globally would yield about 0.435 EH/s. They'd represent less than 0.05% of the Bitcoin network.
That's only if they target Bitcoin and not some other coin which doesn't have an ASIC and has a GPU-friendly hash.
If they had built out the same number of ASICs and GPUs, what you said would make sense.
Back around 2012 I created a paper wallet using an offline website (it was HTML and JS downloaded locally that worked without internet. I put it on a USB stick and then use it in a laptop without internet), printed it out and put it in a safe
I did a similar stunt with an old PowerBook where I electrically disabled the WiFi/Bluetooth so it wouldn’t be online unless I plugged in Ethernet, generated keys, and played around with mining. This was back in 2010 when this was all just basically toys for fun. I also encrypted it all with FileVault.
Then I forgot my pass phrase and have never been able to recover any of it. I don’t even know how many btc were mined/lost.
Before anyone asks, no, there aren’t any usable exploits / vulns found for the encryption methods used. And from what I can tell the coins in question have still sat frozen for going in a decade and a half now. I suspect many other hackers did the same thing…
Apparently legacy filevault can be attacked offline with tools like john the ripper.
If you were attempting to mine Bitcoin with a PowerBook I can confidently say you mined zero Bitcoin
Edit: I thought he was talking about 2012 but yeah in 2010 CPU mining was still a thing
Wasn't the difficulty like 6 orders of magnitude easier back then?
Okay maybe in 2010 you could use a CPU but even by 2012 it was entirely dominated by GPUs and I think even dedicated hardware was coming out around that time or soon after
ehhh you could CPU mine in the early months IIRC. The issue was that 50BTC wasn't even worth a penny back then lol
Wasn't there an offline wallet that used a poor algorithm to develop seed phrases, and thus someone stole all of those coins a couple of months ago?
Aren't you thinking of a hardware wallet?
Yes
Definitely Ledger Ledger confirms spy chip implant behind wallet crypto thefts (796 points, 18 days ago, 515 comments) https://news.ycombinator.com/item?id=50054092
Possibly Trezor (35 points, 16 days ago, 3 comments) https://news.ycombinator.com/item?id=50078423