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CFTC chair Michael Selig says Binance hack shows need for US oversight of offshore exchanges

Michael Selig told CNBC the roughly $6.4bn Binance theft supports the CFTC's proposed crypto rules, while Binance says its investigation has found further points of breach.

Why it matters: The largest theft in crypto history is being used by a US regulator to argue that offshore exchanges should register with the CFTC and meet federal cybersecurity standards.

InvestIn.News NewsDesk · 1 min read
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Picture from Decrypt for: CFTC chair Michael Selig says Binance hack shows need for US oversight of offshore exchanges
Image: Decrypt
Original reporting: Decrypt Staff, Decrypt

Key points

  • Selig said the breach "proves our exact point" for crypto-market rules the CFTC proposed earlier in October
  • Binance has set aside $6.34bn to cover losses and says its probe found "additional points of breach"

The CFTC chairman, Michael Selig, says the record Binance hack shows why offshore crypto exchanges need US oversight, using the roughly $6.4bn theft to press the agency's case for a federal rulebook.

Selig argued that unregulated offshore venues lack the safeguards of US financial markets and pitched a federal option letting them register with the CFTC and meet the same cybersecurity standards. He said the exploit did not break Ethereum or its smart contracts but a vulnerability he believed came from someone's laptop, and that crypto's difference is speed, with attackers able to route funds through tools such as Tornado Cash.

Binance first pointed to a compromised DevOps engineer's laptop, then said on 30 October that its investigation had uncovered additional points of breach.

What to watch: The CFTC's crypto rulemaking proposals, sent to the White House, await further action, while the Secret Service and FBI investigation into the theft continues.

Read the full story on Decrypt

Live updates on NewsFeeds:RegulationEthereumDesk editor: Keshav Aggarwal (accountable for this page; this summary was not edited by hand)

How this was produced: an AI model wrote this summary of Decrypt’s report, which we credit and link above. Read our Editorial and AI policy. Spotted a mistake? See Corrections.

Not investment advice. Read the risk disclaimer.

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