Binance, one of the world’s largest cryptocurrency exchanges, has been hacked. The attack took place on May 7, 2019 and resulted in the loss of over 7,000 BTC, worth approximately $40 million at the time.
While the hack was certainly a major setback for the company, it’s important to note that Binance’s hot wallet, which was Targeted in the attack, contained only 2% of the company’s total BTC holdings. The remaining 98% was safely stored in cold wallets, which were not affected by the hack.
This incident highlights the importance of storing cryptocurrencies in a cold wallet, which is not connected to the internet and therefore much more difficult to hack. For most people, a hot wallet is sufficient for day-to-day transactions.
But if you’re holding a large amount of crypto, it’s best to transfer it to a cold wallet for long-term storage.
So while Binance’s hot wallet was not as secure as it could have been, the company’s overall security measures prevented a much worse outcome. And for that reason, we believe Binance is still a safe and reliable place to trade cryptocurrencies.