A record-setting cyberattack targeting the world’s largest cryptocurrency exchange rocked the digital assets industry Friday, delivering another blow to a sector already struggling to achieve mainstream adoption.The exchange, Binance, announced late Thursday that more than $6 billion appeared to have moved through wallets connected to a security breach, the highest dollar amount ever associated with a crypto cyber attack. Around $3 billion of that had potentially been located and frozen across several exchanges, though it was not immediately clear if those funds were recoverable. It was not immediately clear whether hackers were able to access individual customer accounts or holdings. Binance co-CEO Richard Teng released a video statement Friday morning that sought to reassure platform users that only Binance’s corporate holdings were targeted. “Your assets are safe,” he said, adding the platform had preexisting reserves totaling more than $1 billion designed to cover customer losses, and that it was setting aside an additional $6 billion from its $167 billion balance sheet to shore up further losses. “Binance will absorb the financial impact of these stolen funds, not our users,” Teng said in an X post late Friday. U.S. officials said they are working with Binance to investigate the hack. President Donald Trump said his administration was “looking at” the incident, telling reporters Friday he was reassured by Binance’s pledge to reimburse any losses. The Secret Service said it was working with private-sector partners to identify, freeze, trace and recover funds stolen from Binance, but that the investigation remained in early stages. The hack is the latest setback for crypto, which continues to reckon with a reputation for being too volatile — and too vulnerable to criminal activity — for widespread use. The scale of the hack echoes collapse of crypto exchange FTX, which, though not the result of a cyberattack, led to billions in losses. The renewed doubts were reflected in the value of Bitcoin, which dropped as much as 5% to below $76,000, accelerating a month-long downturn. Other affected cryptocurrencies fell as much as 9%.The crypto industry was already recovering from the failure in Congress of the Clarity Act, a bill that would have granted comprehensive legal protections for crypto assets in the U.S. Despite bipartisan support for the core elements of the legislation, its passage was torpedoed by a battle over conflict-of-interest rules for elected officials, notably President Donald Trump.The president has disclosed in filings that he earned more than $1 billion from crypto last year. The Binance hack stands to prolong this reckoning, experts said.“There will be an imperative for Binance to cover losses not only for its own reputation and value, but I expect there will be a level of co-operation within the space as they look at the collective reputational harm this may, rightly or wrongly, cause to the sector,” Laura Clatworthy, head of digital assets at the law firm Edwin Coe, said in a statement.That cooperation was evident in the immediate responses of other mainstream crypto players. Tether and Circle, which operate the world’s two largest stablecoins, both worked quickly to freeze assets implicated in the hack. The Trump-backed crypto platform World Liberty Financial also worked to freeze USD1 and WLFI holdings tracked to the attackers, a spokesperson told NBC News. Most USD1 and WLFI transactions occur on Binance, according to blockchain data. More than $27 million-worth of USD1 was implicated in the attack, the analysis group TRM Labs reported. The group also assessed that $2.4 billion in Bitcoin and Ethereum will never be recovered. The hack’s origins remain murky. The entire heist unfolded in just 20 minutes starting at approximately 4 p.m. ET Thursday. Binance initially said the attack involved a compromised laptop, but that a subsequent investigation uncovered “additional points of breach.”Multiple blockchain analysis firms said the hack had attributes associated with previous operations believed to have been carried out by North Korean actors. Teng, the Binance co-CEO, said Binance’s investigation had not yet identified the attackers. At least one prominent tech CEO could not resist making light of the situation. Elon Musk left a “yikes” emoji in response to an X user who noted that the collapsed crypto exchange FTX had initially also told users their funds were safe amid a wave of losses. Binance co-founder CZ Zhao responded:“Elon, have a lot of respect for you, but bad time to troll. Please stop.” Zhao noted that his SpaceX shares — the product of a Binance-related $500 million investment in Twitter, were now worth more than $1 billion. “Would appreciate if you show a little support. Thanks!”
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