Binance says it will shoulder the financial impact of an incident it valued at about $6.3 billion, while The Insurer reported, citing a source close to the exchange, that Binance has no cyber insurance.
The exchange said Oct. 31 that a portion of its Secure Asset Fund for Users (SAFU) was expected to be used within 24 hours, alongside funds from its Futures Insurance Fund and company funds. Binance said customers would not bear the cost.
The Insurer reported Oct. 30, citing a source close to the exchange, that SAFU has no external insurance or reinsurance. Bloomberg separately reported Tuesday, citing a person familiar with Binance’s business, that the exchange has no cyber insurance and holds directors and officers (D&O) coverage.
The Insurer said D&O coverage may respond to certain claims against executives, but it does not replace assets taken in the incident. The reports pointed to a broader problem for crypto firms: cyber policies can be hard to secure, while exclusions may limit payouts.
Binance said in its Nov. 1 update that it had covered about 95% of the impacted amount. The remaining 5% consisted of less-liquid tokens, and the exchange said it would continue purchases through market transactions and over-the-counter (OTC) deals. Binance gave no completion date for those purchases.
