Binance, one of the world’s largest cryptocurrency exchanges by trading volume, has been hacked. The exchange announced the news on Tuesday, saying that hackers had stolen 7,000 bitcoins worth about $40 million.
The hack is a major setback for Binance, which has grown rapidly since it was founded in 2017 and is now one of the most popular cryptocurrency exchanges. It is also a blow to the wider cryptocurrency industry, which has been trying to shed its reputation for insecurity.
Binance said it had discovered the theft on Monday and that it had since “stopped all withdrawals” to “protect user funds.” The exchange said it would use its “Secure Asset Fund for Users” to cover the loss, which amounts to about 2% of its total assets.
The hack is likely to raise questions about the security of other cryptocurrency exchanges. Binance was one of the few exchanges that had not been hacked until now.
But it is not the only exchange to have been hit by thieves: in 2014, MtGox, then the largest bitcoin exchange, filed for bankruptcy after losing 850,000 bitcoins to hackers.
Binance said it was “working with law enforcement agencies” and would “provide updates as soon as possible.” It did not say how the hackers had stolen the bitcoins or whether any customer information had been compromised.
The hack is a major setback for Binance and the cryptocurrency industry as a whole. It remains to be seen how Binance will recover from this loss and whether other exchanges will be able to avoid similar attacks in the future.