On May 7, the unthinkable happened. Binance was hacked. Over 7,000 bitcoins were stolen from the hot wallet.
This amounted to a possible $40 million. While the Binance #SAFU funds will be used to reimburse affected users, other questions still remain.
A Twitter AMA (Ask Me Anything) had previously been scheduled prior to the hack. Binance CEO Changpeng Zhao (CZ) held the AMA despite the incident.
In that session, we learned that CZ and Binance are working to rebuild the damaged system and erase the trace of hackers from their data. The process may take a week. During this time, deposits and withdraws will be suspended, but trading on the exchange is still open.
It appears as if this might also require a rollback on the Bitcoin network.
The “re-org” idea was suggested by Jeremy Rubin:
@cz_binance if you reveal your private keys for the hacked coins (or a subset of them) you can decentralized-ly at zero cost to you, coordinate a reorg to undo the theft.
— Jeremy Rubin (@JeremyRubin) May 8, 2019
Initially, CZ seemed to support this idea but has noted that network reorganization might lead to unwanted consequences. Furthermore, experts including co-founder of Bitmain Jihan Wu weighed in the issue.
One argument against the rollback cited damage to Bitcoin credibility. Another held that a rollback could create a potential split within the community.
At the end of the day, CZ decided not to push forward with the “re-org.”
After speaking with various parties, including @JeremyRubin, @_prestwich, @bcmakes, @hasufl, @JihanWu and others, we decided NOT to pursue the re-org approach. Considerations being:
— CZ Binance (@cz_binance) May 8, 2019
Do you think the re-org might have been a viable option? Or is it a toxic idea that kills credibility? Let us know what you think in the comments below.
Disclaimer
All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.
