Binance just suffered the crypto industry's largest hack so far which has sent panic among investors. But Standard Chartered thinks a winner is coming out of this shocking incident. Related:
Binance just suffered the crypto industry's largest hack so far which has sent panic among investors.
But Standard Chartered thinks a winner is coming out of this shocking incident.
Related: Binance major shareholder says user funds are safe after $3B hack
Founded in 2017, Binance is among the earliest crypto exchanges to gain wide popularity among traders due to its centralized model.
It is just like a regular trading exchange where you fund your account, trade cryptocurrencies like Bitcoin (BTC) and Ether (ETH), and hold or withdraw as per your wish.
Users don't have to bother about taking care of their crypto holdings as Binance safeguards them.
The world's largest crypto exchange, Binance has 335 million registered users globally. But it got hit with a $6.3 billion hack yesterday.
As per the onchain analytics platform Chainalysis, funds began leaving Binance hot wallets across multiple blockchains around 4:20 pm ET yesterday and the attacker stole $6.3 billion within minutes.
Chainalysis blamed the hack on the North Korean cybercrime group TraderTraitor.
Binance said today it will cover all losses from the breach "from the SAFU fund and the company's funds." The exchange said it has already reserved over $6.34 billion of company funds to cover the incident.
Standard Chartered’s global head of digital assets research, Geoffrey Kendrick, said the Binance hack could accelerate a shift toward decentralized exchanges (DEXs) among crypto traders.
Unlike centralized exchanges (CEXs) such as Binance, DEXs use blockchain-based smart contracts (self-executing programs following predetermined conditions) to facilitate peer-to-peer crypto trading without a central intermediary.
Watch Mehab Qureshi, senior editor at TheStreet, decode the Binance hack:
How did hackers drain $6.3 billion from Binance in about 20 minutes (3:39)While CEX users leave it to the exchanges to custody their crypto assets, DEX users retain control of their assets through their wallets.
As per Kendrick, we should see DEX's share of crypto trading to expand following the Binance hack.
“I would encourage investors to re-engage with Uniswap,” He suggested and added it has never suffered any hacks.
Founded in November 2018, Uniswap is the largest decentralized crypto exchange.
In his note, Kendrick cautioned that the impact of the latest hack still needs to play out in the markets and investors should wait until then.
“Only after assets are unfrozen and more detail of the hack emerges will we find a new base.”
Note that the Standard Chartered researcher argued in June that Uniswap could be a major winner over the next five years if Wall Street's embrace of the crypto infrastructure continues to accelerate.
Uniswap is uniquely positioned to benefit because of its scale, brand recognition, and role as core market infrastructure, he remarked back then. He even predicted that its native token, UNI, could hit $100 by the end of 2030, outperforming both Bitcoin and Ether.
The price target is based on the bank's analysis that value locked in decentralized finance (DeFi) will hit approximately $2.7 trillion by 2030.
In his Oct. 30 note, Kendrick reiterated his bullish price target of $100 for UNI but said the latest hack is “another reason why that forecast may end up being too low.”
Nearly all the cryptocurrencies are reeling under the impact of the Binance hack, UNI being no exception. It was trading at $6.94 at the time of writing, down 5.9% in a day.
The Standard Chartered researcher's latest bullish call couldn't rescue the crypto asset.
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