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Binance Hacked: Withdrawals Frozen, Manipulation Warning, BTC Dropped

by firstcryptonews
May 28, 2019
in Industry
Binance Hacked: Withdrawals Frozen, Manipulation Warning, BTC Dropped

Major cryptocurrency exchange Binance said that hackers stole more than BTC 7,000 (USD 40 million) from them, as the company have discovered a large scale security breach on May 7, 17:15:24 (UTC).

The company estimates that deposits and withdrawals will be suspended for one week, but they “will continue to enable trading.” In the past 24 hours, the trading volume on Binance stood at USD 1 billion.

“Please also understand that the hackers may still control certain user accounts and may use those to influence prices in the meantime. <…> But we believe with withdrawals disabled, there isn’t much incentive for hackers to influence markets,” they added.

“We don’t know exactly at what extent the number of users affected,” Binance CEO Changpeng Zhao said during a livestream earlier today.

Bitcoin dropped following the announcement and is down by 1.67% in the past 24 hours. The rest of the market is also in red, mostly. Binance Coin, the native token of Binance, is down by 6,66% (04:11 UTC.) Later, the market somewhat recovered.

Binance claims that it will use the #SAFU fund (Secure Asset Fund for Users) to cover this incident in full and “no user funds will be affected.”

Also, during the livestream, the CEO mentioned a possibility to roll back Bitcoin network transactions.

“To be honest, we can actually do this probably within the next a few days. But there are concerns that if we do a rollback on the Bitcoin network at that scale, it may have some negative consequences, in terms of destroying the credibility for Bitcoin,” he said, adding that “we will consider that very, very carefully, with the feedback we are receiving.”

According to recent discussions on Reddit, the crypto community is strongly against the rollback, as “any rollback is a horrible idea. This is the bitcoin version of a government bailout.”

Meanwhile, Binance explained that hackers were able to obtain a large number of user API keys, 2FA codes, and potentially other info.

“The hackers used a variety of techniques, including phishing, viruses and other attacks. We are still concluding all possible methods used. There may also be additional affected accounts that have not been identified yet,” the exchange said.

According to the announcement, the breach impacted thei Bitcoin hot wallet only (which contained about 2% of their total BTC holdings.)

“The hackers had the patience to wait, and execute well-orchestrated actions through multiple seemingly independent accounts at the most opportune time. The transaction is structured in a way that passed our existing security checks. It was unfortunate that we were not able to block this withdrawal before it was executed. Once executed, the withdrawal triggered various alarms in our system. We stopped all withdrawals immediately after that,” the exchange said, adding that the hackers were able to withdraw BTC 7,000 in this one transaction: https://www.blockchain.com/btc/tx/e8b406091959700dbffcff30a60b190133721e5c39e89bb5fe23c5a554ab05ea

Binance suspended deposits and withdrawals even before it announced the security breach, while their CEO claimed that “Funds are #safu.”

As many experts have stressed previously, crypto users should keep their private keys to their coins offline, e.g. in hardware wallets such as Ledger, Trezor, KeepKey and others.

However, Changpeng Zhao earlier this year suggested that cryptocurrency users should store their private keys on an exchange.

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NYDIG, a leading bitcoin financial services firm, has announced that it will welcome the CFO of Bridgewater Associates John Dalby to its team. Dalby joins NYDIG as the new Chief Financial Officer (CFO) in what represents one of the biggest personnel shifts from the mainstream financial industry to the crypto world.  Contributing to the Greater Good  The new CFO held a similar position at Bridgewater Associates, the world’s largest hedge fund, before his appointment to NYDIG. Dalby said that he is delighted to join the team and was committed to helping NYDIG deliver innovative Bitcoin solutions to individuals and institutions.  The former CFO of Bridgewater Associates joins NYDIG during a period of rapid growth. The leading provider of investment solutions for BTC recently raised over $200M in additional capital from a group of strategic partners. The funds came from top institutions such as Morgan Stanley, MassMutual, New York Life, Liberty Mutual, Stone Ridge Holdings Group, and more.  NYDIG also launched a global Insurance Solutions practice that will spearhead the development of bitcoin-powered products and services for the global insurance sector. According to Robert Gutmann, Co-founder of NYDIG, Mr. Dalby brings deep financial services experience to help the crypto custody firm build institutional solutions that deliver BTC safely to everyone.  NYDIG to Help US Banks Offer Bitcoin In what has been viewed by many crypto enthusiasts as another step toward crypto’s mainstream adoption, NYDIG has unveiled an industry-first bitcoin solution for banks.  Rolled out in partnership with fintech giant Fidelity National Information Services, the new product will enable clients of some U.S. banks to buy, hold and sell BTC via their existing accounts.  According to Patrick Sells, head of bank solutions at NYDIG, hundreds of smaller US banks have already agreed to participate in the program. The firm is now engaging some of the leading U.S. banks to join in and enable ordinary Americans to get access to BTC through their existing bank relationships.  Until now, many BTC adopters have been forced to go outside of their traditional banking relationships to acquire the benchmark cryptocurrency.   The vast majority of traditional banks have steered clear of offering bitcoin to their retail customers. Therefore investors often rely on crypto-centric companies like Coinbase or payment giants such as Square and PayPal to purchase bitcoin.  The revolutionary solution from NYDIG will facilitate banks to offer crypto assets to their retail banking clients via a seamless, easy-to-use digital experience.  More Banks Are Asking For Bitcoin Top Wall Street banks only recently warmed up to crypto and unveiled plans to allow their wealth management clients bet on bitcoin. However, they have so far refrained from offering the service to retail customers.  Nevertheless, more traditional banks are now asking for bitcoin as demand for the asset mounts from retail banking customers.  According to Yan Zhao, president of NYDIG, these banks are under increasing pressure to offer BTC to their clients as its reputation as a store of value continues to grow.  “This is not just the banks thinking that their clients want bitcoin, they’re saying `We need to do this, because we see the data.’ They’re seeing deposits going to the Coinbases and Galaxies and Krakens of the world,” Zhao noted.  The NYDIG head predicts that giant banking institutions could soon face pressure to offer bitcoin to more clients as smaller banks roll out their own crypto services.

NYDIG, a leading bitcoin financial services firm, has announced that it will welcome the CFO of Bridgewater Associates John Dalby to its team. Dalby joins NYDIG as the new Chief Financial Officer (CFO) in what represents one of the biggest personnel shifts from the mainstream financial industry to the crypto world. Contributing to the Greater Good The new CFO held a similar position at Bridgewater Associates, the world’s largest hedge fund, before his appointment to NYDIG. Dalby said that he is delighted to join the team and was committed to helping NYDIG deliver innovative Bitcoin solutions to individuals and institutions. The former CFO of Bridgewater Associates joins NYDIG during a period of rapid growth. The leading provider of investment solutions for BTC recently raised over $200M in additional capital from a group of strategic partners. The funds came from top institutions such as Morgan Stanley, MassMutual, New York Life, Liberty Mutual, Stone Ridge Holdings Group, and more. NYDIG also launched a global Insurance Solutions practice that will spearhead the development of bitcoin-powered products and services for the global insurance sector. According to Robert Gutmann, Co-founder of NYDIG, Mr. Dalby brings deep financial services experience to help the crypto custody firm build institutional solutions that deliver BTC safely to everyone. NYDIG to Help US Banks Offer Bitcoin In what has been viewed by many crypto enthusiasts as another step toward crypto’s mainstream adoption, NYDIG has unveiled an industry-first bitcoin solution for banks. Rolled out in partnership with fintech giant Fidelity National Information Services, the new product will enable clients of some U.S. banks to buy, hold and sell BTC via their existing accounts. According to Patrick Sells, head of bank solutions at NYDIG, hundreds of smaller US banks have already agreed to participate in the program. The firm is now engaging some of the leading U.S. banks to join in and enable ordinary Americans to get access to BTC through their existing bank relationships. Until now, many BTC adopters have been forced to go outside of their traditional banking relationships to acquire the benchmark cryptocurrency. The vast majority of traditional banks have steered clear of offering bitcoin to their retail customers. Therefore investors often rely on crypto-centric companies like Coinbase or payment giants such as Square and PayPal to purchase bitcoin. The revolutionary solution from NYDIG will facilitate banks to offer crypto assets to their retail banking clients via a seamless, easy-to-use digital experience. More Banks Are Asking For Bitcoin Top Wall Street banks only recently warmed up to crypto and unveiled plans to allow their wealth management clients bet on bitcoin. However, they have so far refrained from offering the service to retail customers. Nevertheless, more traditional banks are now asking for bitcoin as demand for the asset mounts from retail banking customers. According to Yan Zhao, president of NYDIG, these banks are under increasing pressure to offer BTC to their clients as its reputation as a store of value continues to grow. “This is not just the banks thinking that their clients want bitcoin, they’re saying `We need to do this, because we see the data.’ They’re seeing deposits going to the Coinbases and Galaxies and Krakens of the world,” Zhao noted. The NYDIG head predicts that giant banking institutions could soon face pressure to offer bitcoin to more clients as smaller banks roll out their own crypto services.

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