After one of its customers claimed it was the victim of a $2.6 million breach, the High Court of London ordered Binance, one of the world’s largest cryptocurrency exchanges, to identify hackers and freeze their accounts.
A High Court judge approved petitions by artificial intelligence (AI) startup Fetch.ai for Binance to take efforts to find the hackers, trace and seize the assets, in a decision made public this week.
Despite the tiny amount at stake, the case is one of the first public ones involving Binance and will serve as a test of the English legal system’s capacity to combat cryptocurrency platform theft.
“We can confirm that we are helping Fetch.ai in the recovery of assets,” a spokesman for Binance stated.
“Binance routinely freezes accounts that are identified as having suspicious activity occurring in line with our security policies and commitment to ensuring that users are protected while using our platform.”
“We can confirm that we are assisting Fetch.ai in the asset recovery process,” a spokesman for Binance stated.
“In accordance with our security rules and dedication to ensure that users are safeguarded while using our platform, Binance frequently freezes accounts that are detected as having suspicious behaviour occurring.”
Binance has been subjected to intensive regulatory scrutiny as part of a global assault on cryptocurrencies, amid worries that such exchanges might be used for financial fraud or to allow customers to fell prey to frauds or uncontrolled wagers.
Binance has increased its worldwide compliance team and advisory board, stating that it is dedicated to following relevant local regulations everywhere it operates.
“We need to dispel the myth that cryptoassets are anonymous. The reality is that with the right rules and applications they can be tracked, traced and recovered,” said Syedur Rahman, a partner at Rahman Ravelli, which is representing Fetch.ai.
On June 6, hackers allegedly hacked into Fetch.ai’s cryptocurrency accounts on the Binance exchange, according to the company, which is based in England and Singapore and develops AI projects for blockchain databases.
They reportedly sold the assets to a related third party for a fraction of their worth in under an hour after being unable to delete them due to account limitations.
Binance, which had alerted Fetch.AI of suspicious activity in its account, had already frozen an amount and indicated that it would obey the orders, according to Rahman. Before requesting a recovery order, the claimants must demonstrate that they have been victims of fraud.