Post-Hack, Binance Plans to Re-open Withdrawals and Deposits Tomorrow

Changpeng Zhao (CZ), CEO of major crypto exchange Binance, has announced that the platform plans to fully resume deposits and withdrawals tomorrow. CZ made the announcement in a security incident update published on May 12.

As reported, Binance had suspended deposits and withdrawals as it worked to rehaul its security systems in the aftermath of a major hack on May 7, which resulted in the theft of around 7,070 bitcoin (BTC) from the exchange’s hot wallets — worth over $40 million at the time.

In the latest update, the CEO kept details of the exchange team’s post-hack actions scarce, telling the public that he would reveal more information once the platform had fully resumed all of its operations. He thus briefly outlined that:

“Our team is making progress and has been working through the weekend. In the past few days, we have made some significant overhauls to our system, with a large number of advanced security features added and/or completely re-architected. We will share details on some of the changes later.”

This update represents the third official response from the exchange CEO since the incident took place — the first being a post-hack live AMA and the second being a short outline of measures being undertaken to mitigate the chances of future security breaches.  

From Binance’s disclosures so far, it is known that the hack was reportedly premeditated and conducted by a range of tactics that included phishing and viruses to obtain a large number of 2FA codes and API keys.

The incident also sparked a further controversy when CZ publicly revealed he had considered — and rejected — the idea of responding to the hack with a contentious Bitcoin blockchain re-org approach: i.e. taking steps to incentivize miners to form a consensus to wield 51% of the network’s hashing power to reorganize the blockchain’s transactions after the loss.

In response to fervent community criticism, the CEO chose not to attempt the strategy — whose feasibility was in any case doubtful, according to some opinions — citing the likely reputational damage to bitcoin and threat to its immutability and decentralization principles.

To press time, Binance is ranked the fourth largest exchange globally, seeing a 24% decline in daily trade volumes over the past 24 hours.

Following a week of multi-month price highs, bitcoin (BTC) is trading 4.3% down on the day, but remains above the $7,000 mark at $7,058 to press time, according to CoinMarketCap.