Binance said it had replenished about 95% of the assets affected by its Oct. 29 hot-wallet breach, while founder Changpeng Zhao said the exchange used its balance sheet to cover the estimated $6.3 billion loss.
Zhao said on X on Nov. 2 that Binance had not borrowed money, sold assets or raised funds. He wrote, “Binance covered from its balance sheet.” Binance’s updates describe a partial deployment of its Secure Asset Fund for Users (SAFU), part of its Futures insurance fund and its corporate treasury. An earlier incident update said Binance had set aside more than $6.34 billion in company funds, including $5 billion in affected tokens. The exchange has not disclosed how much came from each source.
Binance reported that about 90% of affected assets had been replenished on Oct. 31. Its Nov. 2 update put the figure at about 95%, with the remaining 5% consisting mainly of less-liquid tokens still to acquire. Zhao said 100% of funds had been allocated and that 5% still needed conversion into smaller tokens. The statements do not explain how the 100% allocation relates to the 95% replenishment figure.
Binance said it would bear the financial impact, stating, “Binance will absorb the financial impact of these stolen funds, not our users.” SAFU, which Binance says was established in July 2018 and is partly funded by trading fees, serves as an emergency reserve. The Futures insurance fund helps limit the effects of liquidations.
Blockchain analytics firm Bitquery traced about $6.3 billion leaving 17 Binance hot wallets across nine networks. Its analysis estimated that about $2.7 billion had been frozen and the attacker still held about $3 billion as of 8:26 a.m. ET on Nov. 2 (13:26 UTC).
Binance said customers could verify at least 1:1 backing for balances in 10 assets, including Bitcoin (BTC), Ether (ETH), Tether USDt (USDT), BNB, Solana (SOL), USD Coin (USDC), XRP, USD1, Ripple USD (RLUSD) and Zcash (ZEC). The Proof of Reserves snapshot was taken at 8 p.m. ET on Oct. 30 (00:00 UTC on Oct. 31). It covers listed customer balances at that time, but does not establish the source of funds used for the recovery. Binance scheduled a broader snapshot covering more tokens for Nov. 4.
