Binance Hack Losses: $6.34B Set Aside, $5B Already Held in Matching Tokens

Binance says it has earmarked more than $6.34 billion of its own money to make customers whole after the largest cryptocurrency theft on record. Independent analysts say they cannot yet confirm that claim. The exchange’s promise to cover Binance hack losses is a bold one, and it now depends on proof that outsiders have not been able to check.

What Binance says it has set aside

According to Binance, the $6.34 billion comes from company funds, and about $5 billion of it is already held in the exact tokens that were stolen. “These assets are in Binance custody,” a spokesperson said. The exchange did not say when it acquired them, and it declined to publish wallet addresses, citing security. It said the holdings will appear in its next proof-of-reserves report, which shows the assets backing customer balances.

Binance has not said which tokens it still needs to buy, when those purchases will finish, or how much of the stolen crypto has been recovered. It did say that roughly $3 billion in affected assets was frozen with help from blockchain partners. That money is not counted in the $6.34 billion.

How the attack unfolded

Binance confirmed the roughly $6.3 billion hack on Friday. The blockchain intelligence firm TRM Labs said funds were drained from Binance wallets across 10 blockchains the day before, and it attributed the attack to the North Korean hacking group TraderTraitor. That attribution comes from TRM Labs, not from a court or from Binance’s own statement in the source reporting.

Analysts want proof before they accept the numbers

Security firm CertiK said it needs more information from Binance before it can judge whether the claimed $5 billion in matching tokens can be verified on-chain. Earlier on Friday, CertiK CEO Ronghui Gu had estimated that the frozen assets plus Binance’s $1.17 billion emergency fund could cover about 66% of the losses. That would leave a gap of around $2.1 billion, which Gu put at about 1.3% of the $165 billion in reserves Binance reports.

Nansen, another analytics firm, said it could not verify what funds Binance had beyond its roughly $1.16 billion emergency fund, or where the money for the remaining losses would come from. Without wallet addresses, the claim rests on Binance’s word until the proof-of-reserves report is published.

Founders point to revenue and other holdings

Binance’s leaders have pointed to the company’s finances. Co-founder Yi He said the exchange’s revenue for the year was enough to cover the losses and that Binance would not need to sell its stake in SpaceX. Changpeng Zhao, who stepped down as CEO in 2023 and later served four months in a US prison over anti-money-laundering violations, said the SpaceX holdings alone are worth more than $1 billion. He added that Binance accumulates the cryptocurrencies it lists because customers can pay trading fees in those tokens. He also said Gulf, Binance’s partner in Thailand, had offered financial support.

Binance said it already sends weekly reports on company funds to Abu Dhabi’s Financial Services Regulatory Authority, and that this requirement predated the hack.

What to watch next

The next proof-of-reserves report is the key test. If it shows the promised tokens in Binance custody, it would back up the company’s claim that customers will not bear the Binance hack losses. If it is delayed or incomplete, the gap between the exchange’s assurances and the independent estimates will stay open. Binance also still has to say which tokens it must buy and how much of the stolen money it can recover.

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File photo: 5 years birthday Binance cake in Paris – 2022-07-08.jpg by Bretwa, CC BY-SA 4.0, via Wikimedia Commons.