At present, the whole crypto space is supporting and praising Changpeng Zhao – founder and CEO of the world’s largest cryptocurrency exchange, Binance on how elegantly he handled the situation.
Let’s look at the big picture right from the scratch!!
Recently, the whole crypto world was in shock on hearing the major hack on binanace. According to the twitter reports, on Tuesday, Binance a Malta-registered Bitcoin & crypto exchange, which is one of the largest and most respected in the market, was attacked by a “large scale security breach”. The platform lost around 7,000 BTC, which is worth around $42 million presently.
According to various reports the “hackers” were able to get a large number of user API keys, two-factor authentication codes, and other important information, giving them easy access to users’ accounts on the platform including withdrawal permissions.
According to Binance reports, a malicious group/entity were able to lay their hands on this information, which includes phishing, viruses and the extraordinary unethical SIM swapping technique along with “other attacks”.
The hackers were able to withdraw 7,000 BTC from Binance’s hot wallet, to which the company says that 7,000 BTC is peanuts i.e 2% of it’s total Bitcoin holdings.
As Soon the report of the hack came out, Top crypto experts and business persons came forward to help CZ Binance. Among them were the creator of Mcafee foundations, john McAfee and Tron founder ‘Justin Tron’.
John Mcafee offered to support binance in catching hackers and also called his other friends to join him.
Similarly, Justin Tron offered to deposit 7000 BTC i.e 40million USDT into Binance.
Many other peer exchanges and wallets too offered help for binance exchange.
Some of the commendable actions taken by CZ were :
CZ Binance came strongly to show support for its user- so withdrawal and deposits were paused immediately. A Twitter user asked Zhao
To which zhao replied.
CZ graciously declined the support of Justin Tron, where he mentioned they will recover from SAFU(security asset fund for user). CZ strong will power were seen in his tweets, where he said ‘ we are hurt, not broke’. He asked users not FUD(Fear, uncertainty, and doubt). Also, Binance is conducting one week review of its security standards.
Let me tell you what is SAFU? SAFU(Secure Asset Fund for Users) is an emergency insurance fund.Binance announced the Secure Asset Fund for Users on 3rd July, 2018.
“Binance will create a Secure Asset Fund for Users (SAFU), to protect the future interests of all users. This will Start from 2018/07/14, where we will allocate 10% of all trading fees into SAFU to offer protection to the users and their funds in extreme cases. The fund will be stored in a separate cold wallet.”
Cz showed his interest when Mcafee offered support and CZ suggested to schedule a time for a meeting. This speaks more about a leader, where he is ready to discuss various options to catch hackers and make sure the users are safe.
CZ took one step at a time to handle the issue smoothly. Moving ERC20 USDT to new cold wallets.
Also, significant updates have been going to the API, 2FA, and withdrawal validation areas, which was an area exploited by hackers during this incident
Being in such situation, CZ binance conducted AMA session to answers the questions of all the users. This shows the True leader quality.
Jeremy Rubin, who has worked on bitcoin and Stellar’s core code, tweeted about reorg to the founder and CEO of Binance: “[Changpeng Zhao] if you reveal your private keys for the hacked coins. you can decentralized-ly at zero cost to you coordinate a reorg to undo the theft.”
Rubin suggested that by getting a majority of miners onboard, the transaction history could be adjusted so that the funds are instead broken up and sent to them instead. “There will be a cost for this “reorganization”, but it would prevent the 7,000 BTC from staying in the hands of the hackers. Further, it wouldn’t have constituted a pure rollback or a reversal of the transaction history writ-large”
The question about rollback was raised during an ask-me-anything(AMA) session held by Binance CEO Changpeng Zhao, sparking a round of speculation that ended with Zhao ultimately dismissing the idea.
One of the developers Udi Wertheimer tweeted in response:
“The idea, this rollback of days would even be practical at all for anyone involved is insane. 1800 BTC per day of the cost of mining. Rolling back four days costs more than the hack itself.”
CZ announced that Margin trading has been confirmed along with the security updates where the security team is consistently working to solve the issues and moreover the platform is looking forward to launch timeline and if possible a stable coin.
Even the co-founder and partner of Morgan Creek digital, an investment firm- Anthony pompliano said CZ Binance deserves credit for smoothly handling the hack and ask users to think whether a credit bank or traditional bank founder would have answered the question of users after a hack!.
The users were thankful and praised CZ Binance for his selfless work and dedication to solve the issue.
Despite all this mess, Binance is introducing the harmony protocol token sale on Binance Launchpad. Harmony is an innovative high-throughput, low-latency, and low-fee consensus platform. All the details of the sale & metrics will be released on May 15th, with an improved lottery schedule.
So by looking above all points, we hope Binance issue will be solved successfully. Truly, CZ Binance has has shown a great leadership quality and graciously trying to solve the problem by closing all the deposit and withdrawal, then held a AMA session and answered users question, reset API keys and transferred the coins to new cold wallet and trying his best get hold of the hackers and establish a secured platform for users.
We hope Binance will bounce back strongly and provide new offers and features.
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