Binance publishes proof its users' balances are backed
Binance says users of 10 tokens can now check their balances are backed at least 1:1, days after an Oct. 29 hack, according to Unchained.
The facts
- Binance said on Nov. 2 that it finished a zero-knowledge proof for its Oct. 31 snapshot, covering BNB, BTC, ETH, RLUSD, SOL, USD1, USDC, USDT, XRP and ZEC, according to Unchained.
- Users log in, download an open-source verifier that Binance says has been independently audited, and run the check locally. A Merkle tree confirms their own account was counted.
- Attackers drained more than $6.3 billion from Binance hot wallets on Oct. 29, according to TRM Labs. The exploit has been attributed to a North Korea-backed group the FBI tracks as TraderTraitor.
- Binance says about $3 billion was frozen onchain and it has set aside more than $6.34 billion to cover losses. Coverage was roughly 95% by Nov. 1, and a new snapshot with more tokens is planned for Nov. 4.
Case notes · Danny's take
Why it matters
A proof of reserves is the exchange showing its working. After a hack of this size, that matters more than any reassuring post. But read the boundaries. The proof covers 10 tokens and one snapshot taken two days after the attack. It says balances were backed at that moment, not that the signing systems are now safe. Binance itself says the investigation found additional points of breach. For users in Nigeria and across Africa who hold dollars on exchanges because the naira cannot be trusted, this is the real question: can you check, or must you just believe?
For traders
Don't treat one snapshot as a clean bill of health. Watch the Nov. 4 snapshot and whether it adds more tokens, the pace of the phased withdrawal reopening, and the last 5% of coverage in less liquid tokens. Also watch exchange outflows. They show whether users trust the proof or are leaving anyway.
For builders
Merkle trees plus zk-SNARKs let users verify solvency without exposing anyone's balance, and the verifier is open source. That is a pattern any custodian can copy. The hack itself points at the weak spot: wallet signing infrastructure, not just the keys.
Not financial advice. Do your own investigation.
This story was summarised with AI from Unchained's reporting and checked against our editorial policy. Danny's take reflects his views. Disclaimer.
Danny Walter
Founder of Moon Republic, Volt Terminal and Moon Republic Academy. Author of The Market Is a Crime Scene and After the Applause.