The breach of the Binance platform and the theft of assets amounting to about $6.3 billion put one of the largest cryptocurrency exchanges under a tough test, and revived the question of which entities have the authority to intervene in investors' funds, after the assets stored there exceeded $150 billion.
The market attracts investors by offering 24/7 trading, without being bound by traditional exchange hours, and networks such as Bitcoin enable direct asset transfers between users, without a central intermediary that can reverse a transaction after it is confirmed, while trading ease remains tied to liquidity and the services employed.
Binance said in its official statement that its online wallets were breached on Thursday evening, and that it temporarily suspended withdrawals to conduct security reviews, while deposits and other unaffected services remained operational. It pledged to cover the stolen assets from the User Protection Fund and the company's resources.
As for Bitcoin, there is no issuing company that holds comparable authority over it, nor a central intermediary that can cancel its confirmed transactions, according to Bitcoin.org. However, holding it within a platform gives the latter control over account services and withdrawals, without extending that authority to the Bitcoin network itself.
The speed of intervention affects the chances of seizing the funds. According to a report by BitQuery, a blockchain data analytics firm, about $729 million of stolen Tether was converted into Ethereum and Tron before being frozen, taking it out of Tether's jurisdiction over its token and complicating its tracking and recovery.
This occurred during the breach of the BNB Smart Chain network in October 2022, when an attacker exploited a vulnerability to mint BNB tokens worth roughly $570 million at the time. The network was paused for several hours in coordination with its operators, and the team said in an official statement that the intervention helped contain the incident and limit losses.