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CZ: Unusual token price fluctuations on Binance are not the result of a hack

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In this post:

  • Binance’s CZ clarifies that recent abnormal price action was not a result of a hack.
  • The founder of Binance says that they have investigated and it was just normal market activity.
  • There was a market price hack on the platform a few days ago.

Binance issued a notice on December 11 about unexpected price swings for a number of the trading pairs it offers. As a direct consequence of this, the exchange’s creator, Changpeng Zhao “CZ”, launched an inquiry to identify the questionable accounts that were to blame for the problem.

The Twitter account for Binance said that the company is aware of what was going on and that it does not seem that the behavior is the result of hacked accounts or stolen API credentials. The exchange also said that all monies are SAFU.

CZ said in a tweet that, according to their findings so far, it seems that this is merely a normal market activity. A single individual began making purchases after making a deposit of cash. “(Hackers don’t deposit)”. Several other people followed after them. According to CZ, there is no obvious connection between the accounts.

The exchange, on the other hand, has taken preventative action against the possibility of manipulation. It momentarily banned withdrawals for certain accounts that had generated gains during the volatility, which according to CZ resulted in complaints being spread over social media.

We are aware of the concept of too much intervention from the platform, ‘too centralized’ attacks… There is a balance to how much we should intervene. Sometimes, these happen in free market, and we need to let it play out.

CZ

Binance is no stranger to difficulties

Binance, the largest cryptocurrency platform in the world, is no stranger to having such difficulties, so this shouldn’t come as a surprise.

In a related development, CoinMamba made a claim concerning API incompatibilities on Binance, wherein price action for certain Altcoins surged but did not match with the actual market value.

CoinMamba’s allegation was quite accurate. The events of today may in some way be intended as retaliation for the assertion made by CoinMamba.

In the aftermath of the price hack on Binance, someone reportedly sold 260,000 Bitcoins worth over $4 billion, as reported by Glassnode. Despite this, the number of Bitcoin addresses that hold 10 coins or more recently hit 153,286, marking a 23-month high. On December 9, 2022, a previous high of 153,266 over the preceding 23 months was recorded.

Moreover, during the month of November, a number of people brought up an issue. It would seem that they were aware of an instance when orders were put on the platform that they had not initiated.

Someone or something was responsible for a surge in the amount of trading activity across a number of assets, including AXS, which was not the focus of this investigation.

CZ later acknowledged that the problems did not originate from the exchange’s end of things. The issue was caused by a trade API key that was compromised and leaked.

Binance was obediently carrying out the requests of its customers and did not have any problems with the operation of its internal systems.

CZ highlighted that Binance regularly monitors such accounts when questioned about the prospect of utilizing stolen or compromised accounts for the purpose of carrying out manipulative transactions.

He said that if a user leaves their account data with a third-party platform that gets hacked, and the hacker is careful in using it, it may be hard to detect from the hacker’s side. However, CZ claims that they give it their best effort.

Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decision.

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