Coinbase highlights cold storage after Binance's $6.3 billion breach
Security & Exploits ·
Coinbase says 99% of customer assets remain in cold storage as regulators and rivals react to a $6.3 billion security incident at Binance.
Binance disclosed a security breach totaling $6.3 billion, prompting other exchanges and regulators to revisit custody practices. In response, Coinbase reiterated that it holds more than 99% of customer funds in cold storage, a figure it detailed in a blog post addressing security measures following the incident, according to The Block.
The exchange framed the disclosure as part of an ongoing security posture rather than a direct reaction to Binance specifically, noting that advancements in AI capabilities are changing the security landscape and that it will continue investing in security innovation.
Binance, for its part, said it has replenished 98% of the stolen assets using its own resources, with the remaining 2% expected to be covered through purchases of illiquid tokens. The exchange also released an updated Proof of Reserves snapshot with expanded coverage, details of which were published in an announcement on Binance's site.
The breach has also drawn regulatory attention. South Korea is considering raising cold storage requirements for crypto exchanges to 99%, a proposal reported in the wake of the $6.3 billion Binance incident by CryptoPotato.
The cluster shows six distinct sources covering the breach, Binance's reimbursement effort, Coinbase's custody disclosures, and the South Korean regulatory proposal, indicating broad attention across exchanges and policymakers. Unresolved is how the remaining 2% of stolen Binance assets will be acquired given their described illiquidity, what specific mechanism or vulnerability enabled the $6.3 billion breach, and whether South Korea's proposed 99% cold storage rule will be formally adopted. It also remains unclear whether other exchanges beyond Coinbase will issue similar custody disclosures in response to the incident.