Binance, one of the world’s biggest cryptocurrency exchanges, fell victim to a major data breach on Sunday evening.
The “security breach” as Binance is reporting it, led to 7,000 bitcoin being taken from the exchange utilizing innovative strategies that helped the hackers operate without being discovered. The stolen Bitcoin at today’s rates brings the total loss at the hands of hackers to roughly $41 million – an amount Binance will have the ability to recoup entirely in merely 47 days, according to one crypto expert.
Binance said that the theft impacted about 2% of its total bitcoin holdings from its ‘hot wallet.’
CEO Changpeng Zhao described in a statement that, “The hackers used a variety of techniques, including phishing, viruses and other attacks,” adding “The transaction is structured in a way that passed our existing security checks.”
Zhao also noted “Once executed, the withdrawal triggered various alarms in our system. We stopped all withdrawals immediately after that.”
Binance to reimburse clients
The stolen bitcoin will be repaid through Binance’s secure asset fund emergency insurance readily available in case of such a breach. Binance did warn, however, that other accounts could be affected.
Leading analyst at The Block and former researcher at Diar, Larry Cermak describes that the theft and subsequent reimbursement will be easy for Binance to make right.
Cermak states that the $41 million is “peanuts” for Binance, and the process will take a quick 47 days to return the money lost as a result of the security breach. Carmak employed data from Binance’s Q1 2019 financial report, which revealed the company generated $78 million in profits throughout the term. With approximately 90 days in any given quarter, the analyst could create an estimate of what Binance makes on a daily basis, which is nearly $875,000 each day in earnings.
Over $356 million stolen from exchanges in Q1
In addition to the Binance hack, cryptocurrency thieves lifted a minimum of $356 million in the first quarter of 2019, which could see the industry face a billion-dollar money laundering issue by year’s end.
A few of the biggest hacks include Cryptopia, which lost $16 million, CoinBene and DragonEx which lost a combined $46 million, Bithumb which lost approximately $19 million and Coinbin, whose losses amounted to over $26 million.
Despite the hacks, however, the crypto revolution is gaining speed, with prices soaring to their highest levels in a year, sparked by accelerating institutional interest.