Binance has published cryptographic proof verifying that its reserves for at least ten major tokens are fully backed on a one-to-one basis, following a recent security breach that saw $6.3 billion stolen. The exchange, which serves 335 million users worldwide, presented reserve ratios for top cryptocurrencies and enabled users to independently verify their holdings through cryptographic techniques. These efforts come as Binance aims to restore confidence after one of the largest hacks in cryptocurrency history.
Reserve verification and cryptographic methods
On Monday, Binance issued its latest reserves snapshot as of October 31, using Bitcoin block 973895 as a reference point. The exchange employed Merkle tree structures and zk-SNARKs to let users confirm their balances without exposing account details.
The data revealed the following reserve ratios: 100.04% for Bitcoin, 100% for Ether and USDT, 106.08% for USDC, 100.99% for XRP, and 101.30% for BNB. All ten tokens listed in the proof were fully backed, although Binance acknowledged coverage was not complete for all supported assets.
To address these gaps, Binance is preparing another reserves snapshot on November 4. Generating this proof is expected to take an additional 40 to 50 hours, as it requires comprehensive data processing for accurate results.
Mini dictionary: zk-SNARKs — Zero-Knowledge Succinct Non-Interactive Argument of Knowledge, a privacy technology that allows one party to prove possession of certain information without revealing the underlying data, widely used in blockchain for secure, private verification.
| Token | Reserve Ratio |
|---|---|
| Bitcoin (BTC) | 100.04% |
| Ether (ETH) | 100% |
| USDT | 100% |
| USDC | 106.08% |
| XRP | 100.99% |
| BNB | 101.30% |
User withdrawals and exchange outflows
Withdrawal activity surged after Binance reopened operations on November 1. The company reported processing approximately $7.4 billion in gross withdrawals as customers reacted to the security incident, according to a spokesperson. However, $2.7 billion in deposits flowed back onto the platform, resulting in a net outflow of $4.72 billion, or about 3% of total platform assets. Most withdrawals were denominated in USDT. Competing exchanges saw a rise in deposits, but the sources of these funds remain unclear.
Binance has previously managed large-scale withdrawals, including an incident in 2022 when it recorded $6 billion in outflows within 72 hours following the collapse of FTX.
Despite the upheaval, major cryptocurrencies showed signs of stabilization by Monday. Bitcoin recovered above $77,000 after a brief six-week low, and Ether rebounded from a two-month bottom.
Market analysts at Bitwise described the market’s adjustment after the hack as “sharp but orderly.”
Asset replacement and the hunt for stolen funds
Binance claims it has replaced nearly 95% of the affected assets using its corporate funds, though sourcing the remainder is more complicated due to lower liquidity among some tokens. The process of converting about 5% of the replacement funds into these less liquid coins is ongoing.
Recovering the stolen cryptocurrencies remains challenging. According to research firm Elliptic, $2.85 billion of the stolen assets have been frozen or seized, while $3.24 billion are still held in the hackers’ addresses. The funds have not been converted into traditional currency, and investigators, including the FBI, attribute the attack to North Korea’s TraderTraitor group, which targeted Binance on October 29.
Mini dictionary: TraderTraitor — A group linked to North Korean state-sponsored cybercriminal operations known for targeting financial and crypto institutions using sophisticated malware and phishing campaigns.
Limitations of proof of reserves
Proof of reserves provides transparency about an exchange’s holdings at a specific moment but does not amount to a comprehensive audit or assure long-term solvency. Analysts point to potential gaps, such as the possibility of exchanges manipulating data to hide liabilities at the time of snapshots. The Public Company Accounting Oversight Board (PCAOB) in the US cautions that proof of reserves should not be mistaken for formal assurance audits, which involve broader scrutiny of financial health and risk management.
A TRM Labs policy executive likened the rapidity and impact of exchange hacks to “bank robbery at the speed of the internet.”
The scale of the Binance incident surpasses several previous cases, including Bybit’s $1.5 billion hack in 2025. Recent events have reignited debate in the crypto community over the comparative safety of keeping digital assets in ETFs, self-custody solutions, or decentralized platforms.
Resumption of services and rising scam threats
Binance has restarted crypto withdrawals on select networks, with US dollar withdrawals resuming soon after. The process to reopen additional networks will occur in stages to ensure system stability.
The company also warned that scammers are attempting to exploit the situation by contacting users through email, direct messages, group chats, and even making small test transfers. Binance is urging customers to verify communications exclusively through its official channels to avoid falling victim to fraudulent schemes.
While attention turns toward the next reserves snapshot on November 4 and expanded withdrawal access, the industry continues to monitor ongoing efforts to secure more of the stolen funds and address broader security concerns.
