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Binance Customers KYC Information Being Leaked Online

August 8, 2019
James Hall


Binance Customers KYC Information Being Leaked Online

It seems the ramifications of the hack of Binance earlier this year in May continue. After stealing 7,000 bitcoin, another hacking entity known as “Bnatov Platon” claims to have hacked the original hackers. Coindesk reports that this information includes know-your-customer (KYC) information which has already started to leak.

Who to Believe?

The article has special insight into this case as they have been in contact with the hacking entity. As well, they have obtained private communications between Binance and Platon.

Platon maintains that they were able to collect the information by hacking the original perpetrators. Binance, on the other hand, holds that this remains unconfirmed. In fact, they allege they acquired the information through the third-party entity they contracted to conduct the KYC. 

In an official statement, Binace states:

“We would like to inform you that an unidentified individual has threatened and harassed us, demanding 300 BTC in exchange for withholding 10,000 photos that bear similarity to Binance KYC data. We are still investigating this case for legitimacy and relevancy.”

Originally the hacker presented as acting in good faith, wanting to catch the hackers and protect customers. This changed when information began to leak. Platon then informed Coindesk of their failed negotiations with Binance, which would have prevented the leaking.

While the truth is still being discovered, it is clear that Platon has information and is not afraid to leak it. They allege to have “60,000 pieces of KYC information” in their collection.

Centralization Fails, Yet Again

The greatest irony of any “hacking” story is that they usually lose sight of the fact that its people who fail, not blockchain technology. Rather than point the finger at various forms of creeping centralization that cause these events, they serve to create the illusion of a wild west environment with hackers at every corner.

Taking a step back, many forget that leaving your cryptos on an exchange means you are entrusting a third-party to store it for you. This means you do not control it, they do. At any time, for instance, withdraws can be suspended by an exchange.

We are also told by government officials that KYC is necessary to prevent terrorists and money laundering. We see the result of that. Personal information is now available and accessible online for countless online criminals.

Believe in Blockchain

There are certainly growing pains involved with any emerging industry. These lessons, either realized personally or through proper education, teach us how to avoid being a victim of these hacks.

Always remember that the moment an exchange possesses your cryptos, it’s no longer yours. Best practices would always have you move your cryptos into a wallet that only you control. The most safe and secure choice is a hardware wallet, such as Trezor or Ledger.

Additionally, it is important to remember that the moment you send personal information, such as KYC information, to an exchange you no longer control that information.