Binance Halts Withdrawals After Suspected Multibillion-Dollar Hack

Binance Halts Withdrawals After Suspected Multibillion-Dollar Hack

Billions leave hot wallets in overnight transfers

The world's largest crypto exchange faced a sudden security crisis on the night of Oct. 29, when a wave of large transfers left wallets linked to Binance. Blockchain security firm Blockaid said it found about $3.3 billion in suspicious flows across Ethereum, Arbitrum and Avalanche, including roughly $2.5 billion from addresses labeled "Binance 14" and "Binance 16" plus about $780 million in USDC from a Binance smart account. Coinbase executive Conor Grogan estimated total outflows at $5.8 billion. Tracker Arkham identified wallets tied to the suspected hacker holding about $5.9 billion in digital assets, a figure that does not necessarily equal the amount taken from Binance.

Exchange confirms incident and suspends deposits and withdrawals

Binance first said it was investigating reports of a potential security issue, then referred to "the security issue" as fact and suspended all deposits and withdrawals. In posts on X, the company said its team was conducting security checks, freezing funds and working with law enforcement, adding that services would resume only after the issue was fully resolved. Binance said user funds were safe and that it would cover all losses, a pledge repeated by co-CEO Yi He. Binance later said verified frozen assets had reached about $3 billion and warned the figure could keep rising. An earlier Bloomberg Law report put frozen assets at $2.54 billion, showing how fast the tally moved.

Stablecoin issuers freeze funds tied to the incident

Major stablecoin issuers moved quickly to block the stolen funds. Tether CEO Paolo Ardoino said the company froze more than $1.5 billion in USDT linked to the incident. Circle CEO Jeremy Allaire said it froze more than $800 million in USDC. Together those two freezes exceeded $2.3 billion, forming most of the frozen total. Other freezes included roughly $200 million by Ripple, about $30.5 million by the Arbitrum Security Council, and about $27 million in USD1. According to Yahoo Finance and Decrypt, Tether froze 975.1 million USDT and Circle froze 823 million USDC in the main receiving wallet, totaling about $1.8 billion in that wallet alone.

Bitcoin falls below $77,000 as the market sells off

Crypto prices dropped sharply as news spread. Cointelegraph reported the broader crypto market fell 3.3%, with Bitcoin and Ether leading the decline. The National reported Bitcoin slid below $77,000, while BNB fell about 7%. Leveraged traders were hit hard: more than $628 million was liquidated in a single hour, including $189.1 million in Bitcoin positions and $156.8 million in ETH positions, while short sellers lost only $21.1 million. The largest single forced closure was an $11.09 million Bitcoin long on Binance at $79,254. Standard Chartered's Geoffrey Kendrick said prices would stay under pressure until assets are unfrozen and more details emerge.

Loss estimates near $5.9 billion, reserves in focus

The scale of the theft remains disputed. Chainalysis estimated about $5.9 billion was stolen, nearly four times the 2025 Bybit theft. Binance's own estimate was about $6.3 billion, though it has not published a formal loss figure. With $2.54 billion frozen, about $3.4 billion could remain beyond reach, far above Binance's $1 billion SAFU insurance fund. CoinDesk estimated the drain equaled about 5.6% of Binance's ETH reserves. Binance has promised a full post-mortem, and its next proof-of-reserves snapshot due Nov. 1 will show whether the gap has been filled.