Binance said it had set aside more than $6.34 billion to cover customer losses from a wallet breach, while co-CEO Richard Teng described the exchange as financially strong, Reuters reported.
Binance estimates that the Oct. 29 compromise of its hot wallets caused about $6.3 billion in token-asset losses. The exchange said it would bear the financial impact through its Secure Asset Fund for Users and corporate treasury.
Teng said Binance was in “very strong financial health” and that customer inflows and outflows had “pretty much normalised,” according to Reuters. A Binance spokesperson put net customer withdrawals at $4.72 billion since withdrawals resumed Nov. 1, the news agency reported.
Binance’s separate figures for the first 9.5 hours of withdrawals on Nov. 1 showed $4.649 billion withdrawn and $1.01 billion deposited, or a net outflow of about $3.64 billion. That figure covers a shorter period than the one cited by Reuters.
By Nov. 1, Binance said it had covered about 95% of the impacted amount. It was still sourcing the less-liquid tokens that made up the remaining 5%. The exchange said customers could verify at least one-to-one backing for 10 specified tokens in its Oct. 31 reserves snapshot.
Binance said its inquiry initially pointed to a DevOps engineer’s laptop as a possible entry point and later identified additional possible entry points. It reported no evidence that wallet private keys had been compromised.
The Federal Bureau of Investigation (FBI) attributed the theft to North Korea and said the stolen assets were being converted primarily into Ether (ETH). AP reported that Kim Yo Jong rejected the U.S. allegation in a statement carried by North Korean state media KCNA.
Binance scheduled another phase to begin at 11 p.m. ET Nov. 2 (04:00 UTC Nov. 3), subject to security and readiness checks. The exchange said it would release a technical report after its investigation.
Binance plans another proof-of-reserves snapshot covering more tokens on Nov. 4.
