Binance Hacker Bounty – A Cryptocurrency Exchange Doing Everything Right.
A $250,000 reward is quite a statement. While in a perfect world, any organization handling millions of dollars per day in transactions would have military-grade security, the Binance Hacker Bounty is the next best thing. To give credit where credit is due, Binance stopped the well-orchestrated attempted theft without a single cryptocoin being stolen. A standing reward of $250,000 is an excellent deterrent against future cryptoexchange hacks.
The Binance hacker bounty, announced back on March 11th, sends a strong message; don’t mess with us. Anybody planning such a hack will be looking over his shoulder wondering if any of his partners in crime will turn him in. Heck, I can see a bounty hunter setting up hackers for the fall by planing the whole thing and recruiting his team — only to them all in and claim his $250,000 reward.
A Hong Kong-based cryptocurrency exchange stung by hackers earlier this month doesn’t appear to be taking the attack lightly.
Going beyond the $250,000 already pledged, Binance has set aside an additional to $10 million in cryptocoin to pay awards in the future. This ongoing Binance hacker bounty could be seen as an insurance policy in its own right.
“Even though the hacking attempt against Binance on March 7th was not successful, it was clear it was a large-scale, organized effort,” Binance said. “This needs to be addressed.”
The standing Binance hacker bounty will be paid in Binance Coin (BNB). BNB has a market capitalization of $826 million, making it a cryptocoin to be respected – and accepted. By comparison, Bitcoin, the largest and most well-known digital currency, has a market value of about $162 billion.
While the company said no funds were stolen, it said that hackers “accumulated user account credentials over a long period of time” and that there were phishing attacks going back to January and February. “Many users fell for these traps and phishing attempts,” it said.
While plenty of online crypto exchanges have formed in recent years as prices for digital currencies have skyrocketed, the platforms bear little resemblance to the well-financed, better-regulated venues that enable investors to buy and sell stocks, bonds and commodities.
The Binance incident is the latest in a string of issues on cryptocurrency exchanges that have spotlighted the risks to users. A large Japanese exchange, Coincheck,was hacked in January, losing about $530 million in customer funds. A small Italian exchange, BitGrail, was hacked in February, with the attacker stealing about $170 million worth of a little-known cryptocurrency called nano. Since 2014, exchange hacks have cost investors about $1.4 billion.
As Crypto Capers staff writer Nat Roth pointed out some weeks ago, crypto exchanges need to have the same level of security and respect as any online bank or stock trading company. That’s when hackers CAN’T succeed at a cryptocoin heist and won’t even think of trying. In turn,this will make something like the Binance Hacker Bounty unnecessary.
As of now Binance has yet to pay any rewards.