The world's flashiest cryptocurrency exchange just got hacked

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One of the world's top cryptocurrency trading platforms has confirmed that a hack resulted in the loss of 7,000 bitcoin this week, equivalent to more than $40 million.

The attackers used several techniques to carry out the heist, including phishing and viruses.

Adding his own opinion, Charlie Shrem noted that the ability for anyone to track and trace the $40 million hoard on an immutable ledger was "testament to Bitcoin's value".

"I would like to thank all the peer exchanges, wallets, security/analytic teams and other service providers for responding to us and helping us in need, and blocking transactions of fraud funds", he wrote on Twitter.

According to Binance, hackers were able to obtain a large number of user API keys, 2-factor authentication codes and potentially some other information as well. He also highlighted that "Binance will use the #SAFU funds to cover this incident in full" and "n$3 o user funds will be affected".

Binance suffered a large-scale security breach today, according to a statement.

Bnance said the withdrawal set off multiple alarms in the system.

Binance is planning a security review of systems and data and said it will give updates throughout the process.

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"All of our other wallets are secure and unharmed", the statement said.

After all, 7,000 BTC is hardly chump change, and the fact that it all came from a single account suggests that it most likely belonged to an institutional investor/trader or a bitcoin whale.

In addition, other crypto exchanges are also diving in to support the affected exchage by blacklisting the addresses to which the stolen funds were transferred as we have seen in the past that hackers immediately head to the fiat-based exchanges to cash out the digital currencies.

But deposits and withdrawals were suspended pending a "thorough security review", which Zhao said would likely take a week.

Are you a Binance user? However, the real action happened in 2018 when we saw more than $1.1 billion in cryptocurrency getting hacked on exchanges.

Bitcoin's price dropped by as much as 4.2 per cent in early Asian trading, as news of the hack broke, although it later recovered some ground.

Until the industry is able to figure out more secure storage mechanisms such as employing third-party custodians dedicated to securely storing crypto assets, the only recourse available for crypto customers will remain compensation after loss.