Syscoin Is Safe, But Binance Creates An Emergency Cold Wallet
July 5, 2018 BY Lesia Dubenko
Binance, one of the biggest blockchain and crypto asset exchange, has been witnessing a series of unusual trading activities this Tuesday related to Syscoin. While the situation has been stabilized, the exchange still decided to create what they call a SAFU fund.
“At 2018/07/03 20:18:00 (UTC), irregular trades were detected from a number of API users, triggering our internal risk management system. As such, Binance made a timely decision to suspend trading, withdrawals, and other account functions,” Binance report reads.
Factually, Binance removed “all existing API keys and requested all API users to recreate their API keys.” The incident concerned Syscoin, a cryptocurrency which saw a series of odd activities on its blockchain platform. Binance calls on users who believe that they were negatively affected by trading SYS to open a support ticket.
Syscoin on their behalf made a statement that no hacking incident was involved, “Syscoin blockchain has not been hacked or compromised in any way. What took place on [July 3] was a combination of events that made the situation more sensational than it needed to be,” it says in a document which the Syscoin team sent to Hard Fork.
The incident in the first place was caused by the incoming of large output value blocks which whilst expected by Syscoin still contained some suspicious activity. The baffling part is that even though the company tweeted that “We are investigating a possible issue on the Syscoin blockchain, nothing is confirmed but we have asked for exchanges to halt trading while we investigate” it still does not know what happened to the odd trading activity specifically on Binance.
However, Syscoin did make sure to make it clear that everything is under control now, “just have some more work to do before enabling trading. Should be soon. Ignore FUD and bad news. Now is an good time to identify which news are bad quality (and remove them).”
Yet Binance is committed to addressing its users potential concerns and will “offer a 70% rebate on the trading fees received from you (does not include referrals) between 2018/07/05 – 2018/07/14. The rebate will be given in the form of BNB calculated using the closing price on 2018/07/14.”
The biggest news, however, is that the crypto exchange is planning to create a Secure Asset Fund for Users (SAFU) which will be a cold wallet storing 10% of all trading fees.
Binance acknowledges that despite growing fast and expanding by adding fiat support, they also encounter multiple problems which need to be addressed. “Binance has achieved explosive growth in the first year. With this growth, we also experience many problems. We must reflect upon these problems, learn from them, and improve ourselves,” the summary reads.