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1. What did Binance publish on November 2?
Binance said on November 2 that it has completed a zero-knowledge proof of reserves for the account snapshot it took at 00:00 UTC on October 31. Holders of any of ten covered tokens can now confirm that their balances are backed at least one-to-one. The snapshot came two days after attackers drained more than $6.3 billion from the exchange's hot wallets on October 29, which makes the proof the first public, checkable evidence of how the exchange's books stand since the theft.
The ten assets in this first proof are BNB, Bitcoin (BTC), Ether (ETH), RLUSD, Solana (SOL), USD1, USDC, USDT, XRP and Zcash (ZEC). That list combines the largest tradable networks with several dollar-pegged stablecoins, which together account for assets that customers most commonly hold on an exchange. Tokens outside the list are not part of this proof, and Binance has said a wider snapshot is on the way.
A proof of reserves is an attempt to answer a simple question for customers of a custodial platform: does the company actually hold the assets it says it owes to users? After a theft of this size, that question carries unusual weight, because the funds in question were taken from the very wallets that service withdrawals.
2. How does the zero-knowledge reserve proof work?
The system rests on two cryptographic tools. A Merkle tree lets each user confirm that their own account was included in the set of liabilities the exchange counted. A zk-SNARK, a compact type of zero-knowledge proof, then shows that the exchange's total reserves are at least as large as the sum of those user liabilities, without exposing any individual customer's balance.
In practice, a user logs in to their Binance account, downloads the exchange's verifier and runs it on their own computer. Binance says the verifier is open source, that its code is published on GitHub and that it has been independently audited. Because the check runs locally, a customer does not have to take the company's word that the calculation was performed correctly; the software either confirms the inclusion of the account or it does not.
The approach differs from older attestations, in which an outside firm reviews balances at a single moment and publishes a summary. Those reports can confirm that assets existed on a given date but give individual customers little to verify for themselves. A zero-knowledge design aims to let every holder check their own position while keeping the exchange's customer data private.
3. Which tokens are covered, and what comes next?
For now the proof covers only the ten tokens listed above. Binance has scheduled a new snapshot for November 4 that will include additional tokens, widening the share of customer holdings that can be verified.
Co-CEO Yi He explained on X that producing the proof takes roughly 40 to 50 hours after a snapshot finishes, with the exact time depending on how many tokens are included. That lag helps explain why the October 31 snapshot was only completed and published on November 2, and it suggests that results for the November 4 snapshot will take a similar span to appear.
Binance also planned to begin reopening withdrawals on more networks and assets on November 3. The exchange described that step as a gradual rollout and said further details would follow.
4. How did the October 29 theft unfold?
On October 29, attackers removed more than $6.3 billion from Binance hot wallets across several blockchains. TRM Labs, a blockchain analytics firm, says most of the theft took place within about 20 minutes. The FBI has attributed the attack to TraderTraitor, a group backed by North Korea.
Binance's account of how the intruders got in has evolved. Its first statement pointed to a possibly compromised laptop belonging to a DevOps engineer, which it said could have given access to a service container and allowed unauthorized withdrawals. The company said at that stage that it had found no sign of a leaked wallet key. CEO Richard Teng later said the attacker had not depended on the permissions of one engineer, and Binance subsequently said further investigation had identified additional breach points, calling the operation a complex attack.
Outside security specialists have offered their own readings. Jonty, the founder of Pangolin Intelligence, said on a podcast recorded on November 2 that the wallet signing infrastructure appears to have been compromised. Pablo Sabbatella, founder of Opsek, appearing on the same program, compared the situation to thieves gaining access to a bank's signing tool rather than stealing individual checks. Both comments point to the machinery that authorizes transfers, not to any single stolen credential.
5. How much has been frozen, and who is covering the losses?
About $3 billion of the stolen assets has been frozen onchain with the help of blockchain partners. They include the stablecoin issuers Circle and Tether and the Arbitrum Security Council, which moved assets linked to the exploit. Stablecoin issuers can freeze tokens at specific addresses, which is one of the few levers available once stolen funds start moving.
Binance halted withdrawals to carry out security checks and then restarted them in phases on November 1. It has pledged to cover all customer losses from its SAFU emergency fund together with company money, and it says it has set aside more than $6.34 billion for that purpose. According to the exchange, customer coverage stood at about 90% on October 31 and reached roughly 95% by November 1.
The remaining 5% is held in tokens outside the ten assets in the proof. Binance describes those tokens as less liquid and harder to buy in size, which makes replacing them more difficult than refilling balances in widely traded assets. On November 2 the exchange said its commitment is unchanged and that the portion already backed is now publicly verifiable through the proof.
6. What does the proof show, and what does it leave open?
The proof speaks to one narrow matter: for the ten covered tokens, reserves at the time of the October 31 snapshot were at least equal to what the exchange owes its users in those assets. It does not show how the attackers reached the signing infrastructure, whether the stolen funds can be recovered, or how the remaining uncovered 5% will be made whole.
Its limits are also built into its timing. A snapshot captures one moment, and the proof relates to the state of balances at 00:00 UTC on October 31, a point after the theft and before the later reopening of withdrawals. Customers who want ongoing assurance will depend on the exchange continuing to publish new snapshots, such as the one planned for November 4.
Ram Ahluwalia of Lumida, speaking on a podcast episode on November 2, said the digital asset industry has failed to secure customer deposits and called the outcome disappointing. He stressed that trust and confidence sit at the center of the business. The remark captures why a verifiable proof matters: for a custodial exchange, the ability to show customers that their assets exist is a core part of keeping them.
7. Why do reserve proofs matter after a security breach?
An exchange that holds customer assets takes on two separate obligations. It must keep those assets safe from theft, and it must be able to show that the balances it reports to users correspond to real holdings. A breach of the size Binance reported puts both under strain at once, because customers cannot easily tell whether the missing funds were drawn from their own balances or from the company's own resources.
Binance's answer to that doubt is the combination of a funded compensation pledge and a verifiable proof. The pledge states who bears the loss, while the proof offers a way to test whether the stated reserves are there. Neither one replaces the other: a promise to cover losses has little value if the funds behind it cannot be shown, and a snapshot of reserves does not by itself settle who pays for what was stolen.
The design choices also matter to customers who are not technical. Because the verifier runs on a user's own machine and its code is public, outside researchers can inspect how it works. The independent audit Binance cites adds a further layer of review, although an audit of the verifier is not the same thing as an audit of the exchange's entire balance sheet.
8. What do the frozen funds and the 95% coverage figure mean in practice?
The $3 billion frozen onchain represents roughly half of the amount that was taken, and it depends on cooperation from organizations that sit at chokepoints in the ecosystem. Circle and Tether can block tokens that they issue, and the Arbitrum Security Council can act on assets tied to the exploit within its own network. Assets that sit on networks without such a control point are harder to halt once they leave the exchange.
The coverage figures describe how much of the shortfall has been replaced in customer accounts rather than how much of the stolen money has been recovered. Binance reported about 90% coverage on October 31 and about 95% on November 1, which indicates that the replacement effort moved quickly while the final portion proved harder. The company ties that last 5% to less liquid tokens, where buying enough supply without moving the price is difficult.
For customers, the practical result is that most balances are already reported as backed and checkable, while a smaller portion remains pending. That explains why Binance framed the proof as confirmation of the backed portion and repeated that its pledge to make users whole has not changed.
9. What happens next for Binance users?
The nearest milestone is the November 4 snapshot, which will add more tokens to the set that holders can verify. Given the 40 to 50 hours Yi He says the proof takes, the results should follow a couple of days later.
At the same time, the gradual reopening of withdrawals on additional networks and assets is meant to proceed in stages, with Binance promising to share specifics as they are settled. Users holding tokens outside the first ten should watch for the expanded proof and for the exchange's updates on how the last 5% of affected funds will be covered.