Binance said Friday that around $3 billion in cryptocurrency assets had been frozen following a potential security breach at the exchange, but recovering the funds could prove more complicated.

Several crypto firms, including stablecoin issuers Circle and Tether, moved to freeze funds linked to the suspected incident on Thursday, while Binance said it would cover all losses and had temporarily suspended deposits and withdrawals as it investigated the issue.

But compensating customers and recovering stolen assets are two separate processes.

Asked by CNBC whether frozen crypto assets could be recovered and returned to their rightful owners, Ari Redbord, global head of policy at blockchain intelligence firm TRM Labs and a former U.S. federal…