What the Binance hack reveals about the risks of cryptocurrency exchanges and how investors can protect themselves.
When a cryptocurrency exchange is hacked, the immediate question for customers is: Who bears the loss? The attack on Binance, which resulted in losses of approximately $6.3 billion, demonstrates the magnitude of the risks. Rogert & Ulbrich explains who is liable, where the limits lie, and how you can protect yourself from fraudsters who exploit such hacks.
Principle: The stock exchange is liable to its customers.
Anyone holding cryptocurrencies on an exchange entrusts them to the exchange for safekeeping. The exchange is contractually obligated to keep the assets secure and release them upon request. If it is hacked, that is initially the exchange's problem, not the customers'.
If losses occur because the stock exchange failed to adequately protect its systems, claims for damages due to breach of duty may be considered. In this case Binance The stock exchange has already announced that it will cover all losses from its own funds.
The situation is different if not the stock exchange, but an individual customer's account is hacked, for example because login credentials were stolen via a fake website. Then it depends on whether the stock exchange violated its security obligations or whether the customer acted carelessly.
Have you lost money on a cryptocurrency exchange? Have it checked whether the exchange is liable.
The risk: If the stock market cannot bear the damage
A liability guarantee is only as valuable as the financial strength of the person issuing it. Even an exchange can run into trouble in the event of very large losses. This was demonstrated by the collapse of the FTX exchange in 2022, where customers did not receive their funds back for a considerable time.
For euro balances with regulated providers, there are obligations to keep customer funds separate. For crypto assets, the European MiCA regulation has required since the end of 2024 that crypto service providers keep their customers' assets separate from their own. However, unlike bank accounts, crypto exchanges are not covered by statutory deposit insurance.
Therefore, it is important to know which company you have entered into a contract with, which supervisory authority is responsible for it, and where your assets actually lie.
Check which provider holds your assets and under which legal system. In a crisis, this will determine your chances of success.
The second wave: Fraud after the hack
Major hacks are almost always followed by fraudulent schemes. Criminals deliberately exploit customers' uncertainty. Typical examples include:
- Fake support calls: Alleged employees of the exchange will contact you and claim that your account has been compromised. You will be asked to transfer your coins to a secure wallet.
- Phishing emails: Messages designed to resemble stock exchange notices will prompt you to register via a link or to claim compensation.
- Recovery offers: Alleged experts promise to recover lost coins against advance payment.
- Fake apps: Fake apps in search results or app stores intercept login data.
No reputable exchange requires you to transfer your assets to a third-party address. No one who wants to help you needs your seed phrase or your two-factor authentication codes.
Anyone who has already transferred crypto assets to scammers should act quickly. With a Blockchain analysis It's often possible to trace where the coins have gone. If they end up on a regulated exchange, funds can potentially be secured there. The Binance hack demonstrates this: stablecoin issuers have frozen billions of dollars.
Did you answer the wrong support call? Every hour counts. Get advice immediately.
How to protect your crypto assets
A residual risk always remains. You can significantly reduce it by following a few basic rules:
- Not everything is on one stock exchange: Only hold what you need for trading on exchanges. Larger holdings belong in a separate wallet.
- Secure your own wallet: Keep the seed phrase offline and in a safe place. Anyone who knows it has access to your assets.
- Strong protection: Use two-factor authentication via app or security key and a whitelist for payment addresses.
- Check providers: Make sure the product is approved in the EU and which company is your contractual partner.
- Collect evidence: Download your bank statements and transaction histories regularly.
In case of damage, do not let yourself be pressured and act through official channels.
Rogert & Ulbrich – Your lawyers for crypto fraud
Rogert & Ulbrich represents investors nationwide in cases of losses with crypto assets, disputes with stock exchanges, and in cases of... Crypto fraud. The partners Dr. Marco Rogert and Tobias Ulbrich They work together with specialists in transaction tracking.
We examine claims against exchanges and other parties involved, secure traces on the blockchain, and enforce your rights out of court and in court.
Have you lost cryptocurrency assets through a hack or fraud? Take contact and secure your claims.
