Binance Offers $250,000 Bounty For Information Leading To Hackers’ Arrest

  • Binance is offering $250,000 for information that leads to the arrest of hackers who attacked it last week
  • The bounty will be paid in its BNB token, and may be split if multiple sources are used
  • Bounties aren't new to the bitcoin ecosystem. Currently available bounties include one for 37 BTC for information on hacker who hacked Satoshi Nakamoto

Hong Kong-based cryptocurrency exchange Binance is offering the equivalent of $250,000 for information that leads to the arrest of those responsible for an attack on its platform last week. The attack, as reported, was only stopped by the exchange’s security systems.

Last week Binance managed to thwart a ‘large scale’ theft attempt, in which it managed to withhold hackers’ funds. Now, the company decided to ‘play offense’ and offer a reward for information that leads to the criminals’ legal arrest.

The security incident saw hackers create API keys for phished users, so they could then pump Viacoin with the victims’ funds and sell the little-known cryptocurrency at a premium in the VIA/BTC trading pair. The irregular trading activity triggered Binance’s security systems, which halted withdrawals.

Binance’s $250,000 bounty will be paid in its Binance Coin (BNB), a token used at the exchange. Those who wish to collect the bounty will have to send the information they have to the exchange, and to their local law enforcement agencies. If local laws allow, the bounty hunters will be able to remain anonymous.

Justifying its move, Binance wrote on Medium:

“To ensure a safe crypto community, we can’t simply play defense. We need to actively prevent any instances of hacking before they occur, as well as follow through after-the-fact.”

Binance

The company noted that if multiple data segments lead to the final arrest, the bounty may be split at Binance’s discretion. To widen its effort, it further revealed it allocated the equivalent of $10,000,000 in cryptocurrency reserves for future bounty awards. The Hong Kong-based exchange’s blog post further reveals it invited other cryptocurrency exchanges and businesses to follow suit.

Notably, bounties are nothing new in the bitcoin community. BitcoinBountyHunter.com currently has several bounties going. The biggest one, for 37 BTC (about $370,000), is being offered for information on the hacker that breached bitcoin founder Satoshi Nakamoto’s email account, and claimed to send a SWAT team to bitcoin pioneer Hal Finney’s home.

Another 20 BTC (about $196,000) bounty is being offered for information on an extortionist who threatened the family of bitcoin angel investor Roger Ver. The website notably doesn’t encourage vigilantism, and reportedly only pays out bounties if the crime if reported to authorities.

Binance Margin Borrowing Passes $100 Million Mark Since July

Neil Dennis

Since Malta-based crypto exchange Binance first offered lending in July, as much as $100 million in cryptocurrency have been borrowed, the company announced in a Twitter post.

The company offers margin lending - which enables lenders to earn interest on cryptocurrency during the term of the loan - on 21 different cryptoassets.

The company announced earlier this week that it was adding margin trading options for two additional cryptoassets: dash and zcash. Binance also announced it would include dash among the assets it allows customers to lend over the exchange. The ability to lend and borrow cryptocurrencies on an exchange helps increase their liquidity, thus, eventually reducing price volatility.

Dangers of Margin Trading

Margin trading in cryptocurrencies has been broadly criticized as leveraged trades amplify potential gains, but also risk increasing potential losses. Given the volatility in the cryptoasset market in recent years, the Bank of England would like to ban the trading of highly-leveraged products to reduce the exposure of retail investors to huge losses.

Altcoins, such as dash and zcash, are more volatile than the better capitalized tokens such as bitcoin and ether as they lack liquidity on exchanges - meaning that because trading in them is so light and infrequent, large price swings can be generated by relatively small block-trades.