--- title: The $6.3 Billion Binance Heist Shows the Risk of Keeping Your Crypto on an Exchange description: North Korean hackers took $6.3bn from Binance. The exchange covered it, but exchange crypto has no deposit insurance. How to protect your holdings. author: Dr Marina Nani (Editor-in-Chief) date: 2026-11-02T09:00:38.215Z updated: 2026-11-02T10:44:24.403Z canonical: https://www.richmanmagazine.com/article/binance-hack-crypto-exchange-risk image: https://cdn.nanimediahouse.com/pexels-3631991.webp categories: Money content_type: News region: Global publication: Rich Man Magazine about: - type: Organization name: Binance --- Binance customers have not lost their money. Bitcoin withdrawals reopened on Sunday 1st November, and the exchange said it had restored the Ethereum network and BNB Smart Chain soon after, three days after hackers took about $6.3 billion in [the largest crypto theft on record](https://www.richmanmagazine.com/article/binance-hack-tether-circle-freeze-safu). On Saturday, Binance said it had already replaced 90% of the stolen amount by using company money to buy new tokens, Reuters reported. The remaining 10% is in less liquid tokens that will take longer to buy. The same day, the FBI named the thief. In a public statement, it said North Korea was responsible for taking more than $6 billion in virtual assets from Binance on or about 29th October, through a hacking operation it calls TraderTraitor. The FBI said the hackers were converting the stolen assets mainly into ether and urged exchanges, blockchain analytics firms and other crypto businesses to block transactions linked to the addresses involved. ## What Binance Customers Lost and Recovered If you held crypto on Binance, so far you have lost only three days of access to it. The exchange has said from the start that users would not bear the losses and that it would cover them from its emergency fund and its own money. Binance's initial investigation traced the breach to a compromised laptop belonging to one of its engineers. The previous record was the [$1.5 billion taken from Bybit](https://www.richmanmagazine.com/article/bybit-north-korea-court-injunction-nft-notice) in February 2025, which the FBI also blamed on North Korea. Bybit also covered its customers. In both cases, the people who held coins on the exchange came through whole, and in both cases that outcome rested on a decision by the company. ## Crypto on an Exchange Is Not Insured Like a Bank Deposit A UK bank deposit is protected up to a set limit by the Financial Services Compensation Scheme if the bank fails. Crypto held on an exchange has [no equivalent protection](https://www.richmanmagazine.com/article/binance-mica-licence-crypto-exchanges-eu) in the UK or the US. When you leave coins on an exchange, you hold a claim on the company, and the coins sit in wallets the company controls. That claim is worth what the company can pay. Binance could absorb a $6.3 billion loss: Reuters reported that it held about $162.8 billion of customer assets in custody at the end of 2025, for 335 million registered users. A smaller exchange hit by a theft on the same scale would have had no way to cover it. History shows the other outcome. Mt. Gox, once the largest bitcoin exchange, lost about 850,000 bitcoin and filed for bankruptcy in 2014, and its creditors waited a decade for repayments to begin. FTX collapsed in 2022 after customer money was misused, and its customers were repaid at the dollar value of their holdings in November 2022, well below what the same coins later fetched. ## Who Holds the Keys to Your Crypto A crypto wallet does not hold coins. It holds the private keys that let you move them. On an exchange, the company holds the keys. With a hardware wallet, a small device you keep offline, you hold them yourself. The phrase people in crypto repeat is 'not your keys, not your coins'. Holding your own keys [moves the risk rather than removing it](https://www.richmanmagazine.com/article/why-bitcoin-kidnappings-signal-a-new-era-of-wealth-protection). Lose the device and the recovery phrase together and nobody can restore your coins. For a large holding, that trade-off is the decision that matters. ## How to Protect Crypto Holdings After the Binance Hack 1. **Keep on an exchange only what you trade.** Long-term holdings do not need to sit in a company's hot wallet, the wallets connected to the internet that hackers target. 2. **Move long-term holdings to a hardware wallet.** Buy it directly from the manufacturer, set it up yourself and store the recovery phrase on paper or metal in a separate, secure place. 3. **Split large holdings.** Spreading coins across more than one wallet or custodian limits what a single failure can cost you. 4. **Check the exchange's proof of reserves.** Most large exchanges publish regular evidence that they hold customer assets one for one. Binance says it will publish an updated report once its recovery is complete. 5. **Turn on two-factor authentication with an app or security key.** Text-message codes are easier to intercept. 6. **Ask a regulated custodian or adviser about larger sums.** Multi-signature wallets, which need several keys to approve a transfer, are standard for institutions and available to private holders. None of this is personal financial advice, and the right setup depends on how much you hold and how often you trade. ## North Korea's Crypto Thefts Keep Getting Bigger The Binance theft is about four times the size of the Bybit theft, which was itself the largest crypto theft on record at the time. The FBI's statement lists the addresses the hackers have used and warns that the stolen ether will be laundered through decentralised finance and instant swap services. For the exchanges, each new record raises the amount they need in reserve. For you, it raises the cost of assuming your exchange will always be able to pay. ## FAQ **Q: Can crypto exchanges be hacked?** Yes. Exchanges hold large amounts of cryptocurrency in wallets connected to the internet so customers can trade and withdraw quickly, and those hot wallets are the main target for hackers. Attackers usually get in by compromising an employee's device or account rather than by breaking the blockchain itself. Exchanges keep most customer funds in offline cold storage to limit what a single breach can reach. **Q: Did anyone get their money back from FTX?** Yes. The FTX bankruptcy estate began repaying customers in 2025 after recovering and selling assets. Claims were calculated at the dollar value of each customer's holdings when FTX filed for bankruptcy in November 2022, not at later prices, so customers who held bitcoin received far less than the same coins were worth by the time they were paid. **Q: How can I get my money back if I get scammed with cryptocurrency?** Report the scam straight away to the platform you used, to your bank if you paid by card or transfer, and to the police. In the UK, you can report fraud to Action Fraud. Keep every transaction record, wallet address and message. Recovery is rare once crypto has moved, and you should ignore anyone who contacts you offering to recover lost funds for a fee, as these offers are a common second scam.