Binance co-founder Changpeng Zhao has compared the exchange’s $6.3 billion security incident with the Mt. Gox hack and FTX collapse. In a Friday post on X, CZ said the dollar value of stolen funds does not tell the full story of an exchange failure.
He noted that Mt. Gox lost approximately 647,000 BTC, making its breach larger in Bitcoin terms. Zhao also pointed to differences in customer exposure when comparing the three incidents.
CZ Highlights Differences in Exchange Losses
The US Justice Department linked roughly 647,000 stolen BTC to the Mt. Gox breach. Prosecutors said attackers accessed the exchange’s wallet server in 2011 and continued stealing funds through 2014.
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FTX, meanwhile, collapsed after former CEO Sam Bankman-Fried misappropriated billions of dollars in customer deposits. He received a 25-year prison sentence in March 2024 for fraud and conspiracy.
Zhao said Binance’s incident was different because it involved a hot wallet rather than customer deposits.
Binance Commits $6.34B to Cover Losses
Binance co-CEO Richard Teng said the exchange had reserved more than $6.34 billion to cover affected assets. Partners also helped freeze approximately $3 billion in related funds.
The investigation identified Ethereum’s EIP-7702 authorization mechanism as part of the attack. Binance said the attacker exploited the mechanism to gain execution approval over a hot wallet.
Binance has yet to release its full technical investigation. Teng also said the exchange plans to publish a Proof of Reserves report.
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