📢 Flash
CZ: A bull market is expected to drive more capital inflows; retail investors are advised to proactively learn about asset security protection.
On November 3, CZ, founder of Binance, said in an interview: “It’s entirely normal for users to withdraw funds following a security incident—some large institutions are compelled to pull assets due to internal compliance policies, and many retail users follow suit. But once withdrawals are complete, a deeper question emerges: *Where should funds actually be stored to ensure real security?* Take my own case: my assets on Binance suffered zero losses, as the platform fully covered all damages from this incident. Still, the uncomfortable reality remains: *Where else can funds go?* Recent months have seen multiple hardware wallet breaches—one traced to the supply chain, another occurring directly during mnemonic phrase generation. This means even users who make *zero operational errors* and strictly adhere to every security best practice—from purchasing hardware wallets themselves, generating mnemonics offline, to safeguarding private keys for five years without a single leak—can still lose everything through no fault of their own, with *no third party held accountable*.
The first wave of impact has already hit Binance—and the platform has since been restored. The second wave, however, may now shift toward smaller, less-secure exchanges—ones that are *not necessarily more reliable than Binance*. As a result, many users who initially withdrew funds quickly find themselves confronting the full complexity of mnemonic management and self-custody again. Data shows less than 10% of withdrawn funds flowed to other centralized exchanges; the vast majority went straight into self-custodied wallets under users’ personal control. Yet self-custody is far from foolproof: if a mnemonic phrase is lost, damaged, or mishandled, assets vanish permanently and irreversibly. In fact, most user losses from self-custody stem not from hacking—but from human error.
That’s why some users, after careful deliberation, are now considering moving funds back onto exchanges. The shift in fund flows is already visible: within less than 24 hours, Binance’s hourly net inflow turned positive; I just saw a tweet whose chart clearly shows sustained net inflows—a strong testament to Binance’s technical resilience and enduring user trust. That said, fund movements will remain volatile over the coming weeks and months. As we previously noted, if market momentum shifts decisively bullish, the scale of capital returning to exchanges will expand further.
Two broader trends also demand urgent industry attention: First, technological advancement—especially in AI—is accelerating at an unprecedented pace, growing exponentially beyond public awareness. Second, the crypto industry’s investment in security infrastructure remains severely lagging: many mature, production-ready AI-powered security tools have yet to be adopted across the ecosystem. I urge all industry participants to meaningfully increase security investment—by expanding dedicated security engineering teams, systematically integrating AI-driven detection and response tools, and forging deep collaboration with leading AI security providers. For retail users, proactively learning how security tools work, mastering practical asset protection techniques, and continuously tracking industry security developments and authoritative alerts have become essential survival skills.”
The first wave of impact has already hit Binance—and the platform has since been restored. The second wave, however, may now shift toward smaller, less-secure exchanges—ones that are *not necessarily more reliable than Binance*. As a result, many users who initially withdrew funds quickly find themselves confronting the full complexity of mnemonic management and self-custody again. Data shows less than 10% of withdrawn funds flowed to other centralized exchanges; the vast majority went straight into self-custodied wallets under users’ personal control. Yet self-custody is far from foolproof: if a mnemonic phrase is lost, damaged, or mishandled, assets vanish permanently and irreversibly. In fact, most user losses from self-custody stem not from hacking—but from human error.
That’s why some users, after careful deliberation, are now considering moving funds back onto exchanges. The shift in fund flows is already visible: within less than 24 hours, Binance’s hourly net inflow turned positive; I just saw a tweet whose chart clearly shows sustained net inflows—a strong testament to Binance’s technical resilience and enduring user trust. That said, fund movements will remain volatile over the coming weeks and months. As we previously noted, if market momentum shifts decisively bullish, the scale of capital returning to exchanges will expand further.
Two broader trends also demand urgent industry attention: First, technological advancement—especially in AI—is accelerating at an unprecedented pace, growing exponentially beyond public awareness. Second, the crypto industry’s investment in security infrastructure remains severely lagging: many mature, production-ready AI-powered security tools have yet to be adopted across the ecosystem. I urge all industry participants to meaningfully increase security investment—by expanding dedicated security engineering teams, systematically integrating AI-driven detection and response tools, and forging deep collaboration with leading AI security providers. For retail users, proactively learning how security tools work, mastering practical asset protection techniques, and continuously tracking industry security developments and authoritative alerts have become essential survival skills.”
