Hacker, send spring breeze to Binance?

If you pay attention to the currency circle, the hacking incident on February 21 should be no stranger to it. On February 21, Bybit said that the exchange was hacked, and 499,000 ETH worth up to US$1.46 billion were stolen, which not only set the largest record for hacker attacks in the amount, but also became another sign of the decline of this bull market. After the incident, Bybit successfully raised funds to overcome this difficulty with the combination of Bybit's rapid response, active handling and market comfort.

After the incident, the North Korean hacker group was accused of being behind the incident. Although Bybit mobilized resources to strictly guard against each other, on March 4, the funds were all cleaned through the currency mixer. Although there are unsatisfactory expenses, customers' losses can be filled, and the exchange is still very strong. Losing a year of profit is not a matter of life or death.

I thought this matter would come to an end, but I didn't expect that the storm would happen again, OKX suffered an unpredictable disaster, and Binance became the biggest winner.

On March 17, OKX issued a burst announcement stating that it had actively decided to temporarily suspend the DEX aggregator service after consultation with the regulator in order to carry out more security upgrades and prevent further abuse. Affected by this, the relevant limit orders and cross-chain orders will be automatically cancelled. OKX indicates that the specific recovery time will depend on the upgrade progress. During this period, users can still make transactions by jumping to a third-party agreement, and other services of OKX Web3 wallet will not be affected.

This release caused a thrilling market. OKX Web3 wallet is undoubtedly the leader in this round of exchange wallets. It has always been said to have experienced silky and exquisite UI design. The DEX aggregation is one of the core functions, which aggregates 300+DEX, which can provide trading services to users with low threshold and low slippage. According to an announcement released by OKX, as early as June last year, the number of active users of OKX Web3 wallet exceeded 4.6 million in a single week, and by December 5 last year, the number of OKX wallet users increased by 991% worldwide. It is enough to see that the wallet is not only an important traffic moat for OKX, but also a key tool for its new traffic.

Why do you just turn off the DEX function that is so important for wallets?

To discuss the reasons, we have to return to a Bloomberg report. On March 11, Bloomberg reported on the Bybit hacking incident, which mentioned that "European cryptocurrency regulators are reviewing the use of a service provided by the crypto exchange OKX because Bybit said that the hackers have used the OKX Web3 platform to clean up some of the stolen money from Bybit, with an amount of $100 million. ”

It seems that there is no problem, but it is actually suspected of being blamed. BYbit said that for people outside the circle, especially regulators with relatively little attention to technology, it can undoubtedly be omitted as "hackers use OKX Web3 to clean up stolen money", that is, OKX Web3 can be used as a tool to clean up money, and deserves great attention. Unfortunately, just a month ago, on February 18, OKX just announced that it had obtained the European Union MiCA license license. At the same time, other exchanges such as Bybit are still queuing up to apply.

The license just approved led to a huge hacking incident, and European regulation quickly came to the wind. Regarding Bybit's remarks, OKX's boss Xu Mingxing was quite dissatisfied with the remarks. On March 11, he posted a long article to retort, saying that Bybit has been making absurd remarks. OKX has cooperated with Bybit many times before to freeze hacker funds, and even provided technical support and guidance to understand its difficulties. However, he hoped that Bybit would stop spreading FUD, which was quite accusing Bybit of being ungrateful.

But if it is said that OKX is wronged or not, from a technical point of view, it is indeed a bit unfair. Although the hacking address of the tool on the chain is OKX Web3 proxy, but as we all know, OKX Web3 is a self-hosted wallet, and OKX DEX is an aggregator that provides users with efficient liquidity by implementing the aggregation services of other DEXs. It is just a tool, does not host any assets, does not serve as a transaction subject, but only provides intermediary services. From the perspective of product attributes, OKX DEX is no different from other aggregator products. Xu Mingxing also bluntly stated in his response that Bybit uses the OKX wallet/DEX API to build its own wallet and DEX foundation.

Response is the response, and the pace of supervision has started, and it is difficult to stop. The EU is still in the exploration of technology, and it does not have a deep understanding of technology, and is always known for its cautious attitude. Therefore, on March 17, OKX had no choice but to suspend the DEX function because it cooperated with supervision to upgrade its technology. Subsequently, Xu Mingxing also forwarded that OKX Web3 has launched a number of anti-abuse prevention projects.Use control measures, including prohibiting IP access to restricted markets and real-time blacklist address detection and interception systems. In the final analysis, we must strictly guard against the outflow of black money.

The EU's regulatory actions affect more than one exchange, but also make plans early for other exchanges that want to apply for a license. According to the news from the X platform big V AB Kuai.Dong, after the OKX DEX is closed, many exchanges will work overtime to rectify their business, including splitting the exchange wallet into an independent APP. The wallet APP will no longer have DEX and cross-chain functions, and will no longer provide official financial management such as CeDeFi. In short, the issuance and operation entities need to be completely isolated from the exchange.

In fact, if you return to the traditional financial world, isolating the issuance and operating entities from the exchanges is a necessary measure in risk control, and each sub-sector should be relatively independent, such as transactions, custody, settlement, etc. However, in the field of encryption, for the convenience of use, DEX and CEX are basic operations, and the business model of exchange + Web3 wallet has been proven to be effective by the market. Otherwise, it will not trigger the exchange's wallet research and development hotline. The two sides are suddenly separated. For users, it not only increases the operation steps and affects trading efficiency, but also contrary to the previously established mental habits of use.

But in the long run, with the increasing degree of compliance in the industry, the separation of entities is also a realistic path. Now it is the leader of large exchanges, and there is a high possibility that other exchanges will follow up in the future. Unless the exchange chooses not to follow the compliance path, but if the compliance trend is in general, the risks of small exchanges that do not follow up should not be underestimated. Of course, in the short term, the impact is only on OKX Web3 itself.

OKX and Bybit both died, and the luckiest thing is Binance. Before the hacking incident, Binance was facing fierce competition between the two. Not only was the brave Bybit in the contract derivatives market, but the products and tools on the chain were short of OKX, especially on the wallet side. As we all know, a wallet is a good thing and is the primary traffic entrance for users to enter Web3. However, Binance's own wallet is either criticized for the old page or is despised as a bad experience. It has finally innovated the Alpha section, and has been seamlessly grafted by its competitors, which is very frustrating.

This time, the removal of OKX DEX undoubtedly gave Binance a good chance to overtake. The business war is simple and unpretentious, and opportunities are fleeting. Management teams have come to recommend it one after another. He Yi is active in the KOL comment section and recommends his own wallet, saying that he is giving him a chance. Binance also acted quickly and quickly announced that it was exempt from handling fees for wallet transactions within 6 months. This wave of strong publicityIt still has a certain amount of voice, and some users have begun to try using Binance Wallet. But the problem is not non-existent. A user on X James said that he bought 5000U BOB in the Binance Alpha section. Although the transaction was silky, it was clipped off by 1200U. In response to this, He Yi was also very proud and made a promise to cover compensation for severe clips for 24 hours.

As far, Binance has caught this wave of traffic. Of course, in addition to Binance, there are many other competitors who are snatching traffic. Bitget Wallet launches a week-long recharge incentive activity with a $90,000 prize pool, and UniversalX is also focusing on KOL's concentrated recommendations. Ultimately, a good experience can make the product go further.

After this incident, some people in the market jokingly called Binance the "son of luck" and succeeded in over two major opponents at unexpected nodes. It’s hard to say whether he is the son of luck or not, but Binance has been very proud recently. Last week, in addition to this week's wallet promotion, Binance last week was still exciting. Not only did it earn $2 billion to join the UAE royal family, CZ's "unpredictable" MEME has finally become formal.

CZ finally mastered the way to play MEME. At 2:38 pm the second day after the financing news was announced, Binance Chinese official account released a MEME picture of the editor wearing Arabic clothes on social media. Then, CZ forwarded the tweet with the caption "Mubarak". The MEME market was immediately heard, and for a time, Four.meme launched dozens of tokens with Mubarak as Ticker.

I thought CZ, who didn't understand MEME, might be another wave of flow, but CZ started its own rhythm. First, the certified leading coins were forwarded among many coins, and then the MEME was continuously exposed. On March 15, Binance Alpha even launched the new Mubarak. Even on the evening of March 16, CZ's public wallet also purchased 1BNB's $Mubarak. A series of operations directly made Mubarak’s market value exceed US$130 million, and netizens jokingly claimed that it would give BSC a few more A8 players.

I found the way and found the method. Later, CZ and He Yi started the MEME test site, forwarding the meme sentences and memes from time to time, and personally hyped MEME. I won’t mention how MEME is yet to be mentioned, but this round of operations has really benefited the BSC ecosystem. According to data from on-chain analyst @hoidya, BSC's TVL continues to grow for 4 days starting March 13, DEXTrading volume and average trading fees also rose to new highs in a week. What is more intuitive is that the price of BNB is rising against the trend even when the market is unstable, rising from the highest increase of US$507 on March 11 by US$643, and now it is stable at US$616.

This attempt was just a small test of CZ. It was at this time that CZ truly understood the importance of attention economy. Under today's market conditions, liquidity is highly dependent on the macro market, and paying attention to the economy is an indispensable task for every public chain. In this regard, the well-known KOL cryptocurrency also expressed its opinion, "CZ's idea is correct. The core of reviving BSC is to stabilize BNB price expectations as the cornerstone, and continue to create new memecoin with explosive power to spread as fuel. Through split-disk liquidity management, "old coins are exchanged for highs and new markets and restarts at lows" to maintain ecological debt control, allowing retail investors to invest repeatedly in a hundred-fold narrative rotation rather than sedimentation."

It is quite interesting that as early as 2023, CZ also made remarks that she would not invest in MEME. Times have changed. CZ is no longer the CEO of Binance, but BNB's growth is still under his shoulders. It may not be his wish to become a MEME manufacturing machine, but as Binance's number one spokesperson, CZ still has the responsibility to enter the community and lead growth.

It is sad that the controversial Binance finally heard the long-lost applause, but because its competitors were hit hard and the founder finally traded MEME. Is this a blessing or an unfortunate thing in the industry? In the currency circle where the times are rising and falling, there may be no time to think about this issue.