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Binance, the world's largest cryptocurrency exchange by trading volume, said on Thursday, October 29, that it was investigating a potential security issue after billions of dollars in crypto moved out of wallets linked to the exchange — and that $2.54 billion in related assets had been frozen. The incident, first flagged by on-chain trackers in the evening US time, triggered an immediate sell-off across crypto markets, with Bitcoin falling to a six-week low.
Binance has not called the incident a hack, and it has not confirmed a cause or a final loss figure. That distinction matters: much of what circulated overnight is tracker estimates, not confirmed losses. Here is what is confirmed, what is estimated, and what to watch next.
What happened on October 29
According to reports from CNA and blockchain trackers, the suspicious transfers came from Binance hot wallets — the online wallets used to process customer withdrawals. The first transfer went through at 4:24 p.m. ET, and an Ethereum transaction recorded at 20:24 UTC showed a wallet labelled Binance 14 sending roughly 167,464 ether alongside about 1.6 billion USDT to a newly created address.
Binance said its teams were actively investigating, and as a precaution it temporarily suspended deposits and withdrawals while it conducted security checks, and paused trading on its Binance Alpha platform. The exchange said withdrawals would resume once the issue was fully resolved, and warned users against unofficial recovery links and requests for account credentials.
What $2.54 billion frozen actually means
Binance said the verified total frozen stood at $2.54 billion and "may continue to increase" as it works with law enforcement, token issuers and blockchain intelligence firms. The total is made up of freezes by several different companies, not a single recovery. Stablecoin issuers Tether and Circle can block specific addresses from moving their tokens: Tether chief executive Paolo Ardoino said the company froze more than 1.567 billion USDT, while Circle chief executive Jeremy Allaire said Circle froze more than 800 million USDC in coordination with law enforcement. Binance co-founder Yi He added that Ripple froze roughly $200 million and that World Liberty Financial froze about $27 million in stablecoins plus about $2 million in its own tokens.
A freeze stops tokens from moving. It does not by itself mean the assets have been returned to Binance or to users. Bitcoin and ether have no central issuer that can freeze them, which is why the stablecoin freezes are doing most of the containment work here.
How big was the outflow? Estimates disagree
This is where the numbers need care. Blockchain analyst Spreek tracked about $3.55 billion moving into one unlabeled wallet, while Conor Grogan, a director at Coinbase, estimated total outflows at up to $5.8 billion, and Arkham Intelligence put assets in the attacker-linked wallet cluster at about $5.84 billion. The Wall Street Journal reported at least $1.7 billion stolen. These figures reflect wallet movements and holdings, not confirmed permanent losses — and the gap between outflows and freezes is exactly what investigators are now trying to close.
Researchers are also examining a technical theory that Ethereum's EIP-7702 account-delegation mechanism was involved in an unauthorised wallet operation. That is a theory based on transaction activity, not a root cause confirmed by Binance, and it should be treated as unconfirmed until the exchange publishes its post-mortem.
What Binance and its founders are saying
Binance's own statements shifted during the evening: an early post said its teams were investigating, a later version added that it had "not confirmed any impact to user funds," that sentence was then dropped, and a further version said user funds are "completely safe." Co-founder Changpeng Zhao, who no longer runs the company, wrote on X that "it does look like a hack on Binance" and that he expects all user funds to be fully covered. Yi He said plainly: "Binance will cover all hacking losses."
Binance.US, a separate exchange, said it was not affected by the incident. Binance says it has more than 300 million registered users globally and about $160 billion in assets under custody, according to its 2024 annual report — scale that explains why a single evening's transfers moved the whole market.
Why markets fell
According to reports from Reuters, Bitcoin dropped to a six-week low of $77,646, ether fell to a two-month low of $2,238.76, and Binance's BNB token was down more than 8% over 24 hours at $694. The sell-off came on top of an already weak day for technology stocks, after soft earnings from major companies — a reminder, covered in our Alphabet earnings miss explainer, that crypto no longer trades in isolation from wider risk sentiment.
The next milestones are concrete: Binance's promised incident review, the resumption of normal deposits and withdrawals, and an accounting of any customer impact. Until then, the confirmed facts are the $2.54 billion frozen, the suspended withdrawals, and the pledge to cover losses — everything else is still under investigation.