Key Takeaways
- CZ praised U.S. agencies like the FBI for tracking and freezing funds after Binance’s $6B security breach.
- This swift law enforcement response prevented a deeper bitcoin market crash despite $1.5B in liquidations.
- Wall Street analysts dismissed long-term impacts, blaming the exchange’s security rather than Bitcoin’s code.
CZ Praises US Role in Binance Hack Aftermath
As Binance continues to recover from the security incident that caused losses of over $6 billion, Binance co-founder Changpeng Zhao, better known as CZ, has highlighted the role of US law enforcement agencies in mitigating the hack’s impact on the wider cryptocurrency market.
Zhao, one of the first voices linked to the exchange to acknowledge that the strange movements did “look like a hack on Binance,” praised the agencies’ role in collaborating to contain the scope of the incident.
“US Law Enforcement agencies (FBI, USSS, IRS and more) provided vital help in this incident, including tracking, freezing, etc.,” Zhao said on social media channels after the Federal Bureau of Investigation (FBI) attributed the hack to a North Korean hacking group known as Tradertraitor.
Furthermore, the former Binance executive stressed that the hack’s impact on cryptocurrency prices was contained by the agencies’ swift actions.
“A tweet can’t fully express our gratitude. Many crypto bros may not realize, a lot of the ‘why bitcoin didn’t drop more?’ credit goes to them,” Zhao assessed.
While bitcoin dropped to a multi-week low shortly after the hack, reaching $76,320 and sparking over $1.5 billion in liquidations, and larger crypto shares like Coinbase and Strategy fell, for CZ, this might have been worse without the involvement of these agencies.
Specifically, the FBI has been actively involved in tracking the movement of stolen funds across the blockchain, calling on private sector entities to block transactions involving these stolen funds, and publishing a list of ETH, BTC, and SOL addresses that hold or have held assets from the theft and are operated by or closely connected to North Korean Tradertraitor actors.
Wall Street firms have downplayed the hack’s effect on bitcoin prices, with analysts from Cantor-Fitzgerald and TD Cowen pointing out that the hack revealed weaknesses in Binance’s security infrastructure and not in Bitcoin’s solid programming.
While painful, analysts agreed that Bitcoin’s long-term direction was unfazed, and that prices would eventually recover, with Bitwise’s CIO Matt Hougan predicting prices would return to prior levels within a week.
