Binance’s User Protection Fund Falls to $580M as Half of SAFU Bitcoin Is Deployed

Binance has used approximately 50% of the Bitcoin held in its Secure Asset Fund for Users (SAFU), leaving the emergency reserve with a balance worth around $580 million. The exchange has committed to rebuilding the fund but has not revealed when the remaining shortfall will be restored.

Data from mempool.space showed that Binance’s designated SAFU wallet, 1BAuq7Vho2CEkVkUxbfU26LhwQjbCmWQkD, contained slightly more than 7,500 BTC on Tuesday. Four transactions conducted on October 31 contributed to the reduction.

The wallet held approximately 15,000 BTC in February, after Binance converted its roughly $1 billion reserve from stablecoins into Bitcoin. Based on a BTC price of around $77,000, the remaining coins are worth approximately $580 million.

SAFU Falls Below Binance’s $800M Rebalancing Threshold

Binance’s published SAFU guidelines state that the exchange will restore the reserve to $1 billion if its value falls below $800 million because of Bitcoin price fluctuations.

However, the policy does not specifically explain how the threshold applies when Binance withdraws funds for emergency purposes rather than when market movements reduce the reserve’s value.

The exchange confirmed on October 31 that it would use part of SAFU to help finance a $6.34 billion response to the major security breach. The recovery effort also involves Binance’s corporate treasury and a portion of its futures insurance fund.

Binance said it intended to rebuild the user protection reserve to approximately $1 billion. However, it did not provide a deadline for replenishment or disclose how much was taken from the insurance fund.

Binance Yet to Confirm When the Reserve Will Be Restored

The latest transactions have left SAFU holding considerably less Bitcoin than it had earlier this year. The absence of a replenishment schedule means users still do not know when the reserve will return to its intended level.

CoinDesk has contacted Binance for further information about the fund’s balance and restoration plans.

The reserve reduction comes after Binance reported that it had replaced 90% of the cryptocurrency stolen in the $6.3 billion hack.