Binance announces that there was a large scale security breach and hackers were able to withdraw 7000 BTC from the exchange. The hackers were only able to compromise their hot wallet, which contained only about 2% of their total BTC holdings. A hot wallet is an exchange's active wallet, involved in sending out and receiving BTC from the outside world.
Binance claims the hackers were able to obtain a large number of user API keys, 2FA codes, and other user info through phishing, viruses and other attacks. Binance called the attack "well-orchestrated".
Binance will conduct a security review for one week and disable deposits and withdrawals during this time.
Binance will use SAFU (Secure Asset Fund for Users) to cover the lost funds. SAFU is an emergency insurance fund established on July 14th, 2018; 10% of all trading fees on Binance are sent to SAFU and only to be used in extreme cases. The fund is stored in a separate cold wallet.