Binance to Cover Hack Losses With $6.34B in Company Funds
Binance CEO Richard Teng said the exchange will cover all losses from this week’s hack with company funds, and that customer assets were not affected. Binance has reserved more than $6.34 billion, including $5 billion already held in the stolen tokens, such as USDC, USDT, BTC, ETH and BNB. The exchange is buying the remaining assets through market and over-the-counter channels.
Teng said the attacker exploited an EIP-7702 delegation to bypass Binance’s normal approval controls and used a self-destruct mechanism to erase tools and traces. Binance paused withdrawals while it reviews security and aims to restore them by Sunday. It plans to publish a full proof-of-reserves report by Monday.
The attacker continued moving funds on Tron, while Aave said it had reopened its V3 and V4 markets after a precautionary freeze. Binance’s response may reassure users, but the hack raises questions about hot-wallet security and could keep attention on exchange risk and crypto-market volatility.
Neutral
The immediate market impact is mixed, making a neutral view appropriate. Binance’s pledge to cover the losses with company funds, its statement that customer assets were untouched, and its planned proof-of-reserves report may limit panic and withdrawals. Those assurances could support confidence in BNB and broader exchange-linked activity.
At the same time, the scale of the hack and the reported bypass of normal approval controls raise concerns about hot-wallet security and operational risk. Continued movement of stolen funds can create short-term uncertainty, while paused withdrawals may prompt traders to reduce exchange exposure or move assets to self-custody. These reactions could increase volatility, particularly in tokens or venues directly connected to the incident, without necessarily creating sustained market-wide selling.
Past exchange failures and hacks, including Mt. Gox and FTX, show that loss of confidence can trigger sharp withdrawals and broader selling. This case differs because Binance says it will absorb the loss and protect customer balances. In the short term, traders are likely to watch withdrawal availability, on-chain fund flows and the promised reserves disclosure. Over the longer term, the incident may strengthen demands for independent verification, stronger wallet controls and clearer exchange risk management. If Binance delivers on its commitments, confidence may recover; further security findings or delays could renew pressure.