Coinbase and Kraken Ramp Up Security After Massive Binance Hack
Crypto exchanges moved Friday to shore up their defenses and called for faster information-sharing after a record $6.3 billion hack of Binance.The attack, which analysts blame on North Korea, exposed how vulnerable the industry remains just as exchanges become more embedded in mainstream finance. Binance, the world’s largest exchange, halted withdrawals after the attack Thursday and said it will use company funds to cover the losses.Coinbase adjusted the systems it uses to store cryptocurrency keys offline “solely out of an abundance of caution”, while Kraken said it is monitoring industry incidents for lessons it can apply to its own defenses. Franklin Templeton’s head of crypto, Chris Perkins, said security must be addressed immediately for crypto to reach its potential. OKX CEO Star Xu called for a real-time alert system that lets participants share information the moment a hack occurs, coordinate a response and temporarily freeze suspected stolen funds.Stablecoin issuers did some of that freezing. Tether froze nearly $1.57 billion linked to Binance, and Circle froze $800 million. Binance has said about $3 billion in assets is frozen so far. Executives expressed confidence that Binance has the resources to cover the losses. “Our expectation is the industry writ large will actually not suffer material losses,” said Josh Riezman, chief legal and strategy officer at crypto firm GSR.Coinbase CEO Brian Armstrong offered direct help in a post on X late Thursday. His team was “blocking sends to compromised wallets,” he wrote, and Coinbase had contacted Binance to offer assistance. “Moments like this call for the industry to work together,” Armstrong added, saying protecting customers and sharing useful information should come first regardless of which platform people use. He also noted that crypto has always come out stronger after tough times.Tensions flared on X as well. Tesla and SpaceX CEO Elon Musk replied to news of the hack with “Everyday is Zeroday” and laughing and grimacing emojis, the latter under a post comparing Binance’s assurances to those made before FTX collapsed. Binance co-founder Changpeng Zhao pushed back. “Elon, have a lot of respect for you, but bad time to troll. Please stop,” he wrote on X, pointing to Binance’s SpaceX stake, which began as a $500 million investment in Musk’s Twitter takeover and is now worth more than $1 billion. “Would appreciate if you show a little support,” Zhao added. He also cautioned that the losses may prove somewhat higher than estimated but said Binance will cover them.Binance has said its initial findings point to a compromised engineer’s laptop that gave an attacker access to a service container, and the company has promised a full technical report. It expected withdrawals to resume within 48 hours of its Friday update.Shares of Coinbase are currently trading at $143.54 while SpaceX stock is priced at $134.72.