Beginner's Guide to the Secure Asset Fund for Users (SAFU)
SAFU is an emergency reserve fund established by Binance to provide additional protection for affected users in the event of a severe security incident on the platform. It is not an absolute compensation guarantee and does not replace account security measures.
What is SAFU
SAFU was established in 2018, funded by a portion of trading fees allocated by Binance. Its purpose is to serve as an emergency reserve for security vulnerabilities or platform-level incidents, kept separate from daily operational accounts and not used for general business expenses.
How the Fund Works
In the event of a severe security incident resulting in user fund losses, Binance may utilize the SAFU to compensate affected users. This is a platform-level contingency arrangement; whether compensation is provided, the scope of coverage, and the available reserves are subject to the rules and disclosures applicable at that time. The fund's name should not be interpreted as providing unconditional insurance for every account.
Functions and Limitations
SAFU serves as a supplementary line of defense beyond cold storage, two-factor authentication, proof of reserves, security audits, and risk management. It is designed to mitigate the impact of extreme events but does not guarantee that losses will not occur, nor does it imply that compensation is automatically granted for every incident.
Origin of the Name
The term "SAFU" originated from an internet meme in 2018. At the time, Changpeng Zhao reassured users by stating "Funds are safe," which was subsequently altered to "Funds Are Safu" in related videos and widely circulated. Binance later adopted this name for the fund.
Original Tutorial
https://www.binance.com/zh-CN/academy/glossary/secure-asset-fund-for-users
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