Binance temporarily suspended withdrawals after reporting a security breach involving approximately $6.3 billion in stolen digital assets, triggering losses across cryptocurrency markets and shares of companies exposed to the sector.
The incident, disclosed on Thursday evening, represents the largest reported cryptocurrency theft on record, according to the exchange. Binance said it had worked with industry partners to freeze approximately $3 billion in affected assets and would cover all losses using its own funds.
The exchange expects withdrawals to resume within 48 hours, subject to the completion of additional security checks.
Bitcoin fell sharply following the announcement, while Ether, Binance’s BNB token and several cryptocurrency-related stocks also recorded significant declines.
Binance Reports Record $6.3 Billion Security Breach
Binance, the world’s largest cryptocurrency exchange, confirmed that an attacker had exploited a security vulnerability to carry out unauthorised withdrawals.
The company estimated the total financial impact at $6.3 billion, making the incident substantially larger than previous cryptocurrency exchange hacks.
According to Binance, the breach originated from a compromised laptop belonging to a DevOps engineer.
The attacker used the compromised device to execute unauthorised withdrawals from the exchange.
Binance said its investigation had found no evidence that private keys associated with cryptocurrency wallets had been exposed.
The distinction is significant because private keys provide direct control over digital assets held in cryptocurrency wallets.
The company has temporarily halted withdrawals while it conducts security checks and works to prevent further unauthorised transactions.
Binance indicated that it expects the suspension to last no longer than 48 hours, although the resumption of withdrawals remains dependent on the completion of its security procedures.
Binance Freezes $3 Billion in Assets and Pledges to Cover Losses
Binance said it had coordinated with industry partners to freeze approximately $3 billion of the assets affected by the attack.
The exchange also committed to reimbursing all losses from its own financial resources.
According to the company, customer funds remain protected despite the scale of the incident.
The response has involved cooperation with issuers of major stablecoins, which have the ability to freeze certain tokens associated with suspicious transactions.
Circle, the company behind the USDC stablecoin, confirmed that it had frozen more than 800 million USDC linked to the breach.
Tether separately reported freezing more than 1.567 billion USDT associated with the attack.
The measures were intended to prevent the movement of stolen funds and limit the financial consequences of the incident.
Binance co-founder and former Chief Executive Changpeng Zhao also commented on the situation.
“It does look like a hack on Binance,” Zhao said in a social media post.
The company’s commitment to cover losses and restore withdrawals will remain an important factor in determining how quickly confidence returns among its users.
Bitcoin and Stablecoins Account for Billions in Stolen Assets
Blockchain analytics firm Glassnode provided a breakdown of several major cryptocurrencies removed from Binance during the attack.
According to its data, the stolen assets included approximately $1.66 billion in Tether’s USDT stablecoin.
The attacker also withdrew 17,985 Bitcoin, valued at approximately $1.45 billion at the time.
A further $767 million in USDC was transferred from the exchange.
Ether and several smaller alternative cryptocurrencies were also among the affected assets.
The figures illustrate the scale and diversity of the digital assets involved in the incident.
Glassnode also reported that Binance’s holdings of its native BNB token were “left untouched.”
The absence of a reported reduction in BNB holdings contrasted with the substantial losses involving Bitcoin, stablecoins and other cryptocurrencies.
Bitcoin Falls Below $77,000 Before Recovering Some Losses
Cryptocurrency prices declined following the disclosure of the security breach, extending losses recorded earlier in the week.
Bitcoin, the world’s largest cryptocurrency by market capitalisation, fell 2.5% to $78,106.60.
During the initial market reaction, the token dropped as low as $76,518 before recovering part of its losses.
Ether declined 3.7% to $2,232.66, reflecting broader selling pressure across the digital asset market.
Binance’s native BNB token also weakened, although it recovered from its initial decline to trade 5.9% lower.
The selloff reflected concerns about exchange security, the potential impact on market liquidity and uncertainty surrounding the recovery of stolen assets.
The temporary suspension of withdrawals also added to investor caution as Binance worked to complete its security review.
Coinbase, Strategy and Robinhood Shares Decline
The market reaction extended beyond cryptocurrencies to publicly traded companies with significant exposure to digital assets.
Shares of Coinbase Global (NASDAQ:COIN), a major US cryptocurrency exchange, fell nearly 5% in Friday’s premarket trading.
Strategy (NASDAQ:MSTR), which holds substantial Bitcoin reserves as part of its corporate treasury strategy, also declined by approximately 5%.
Robinhood Markets (NASDAQ:HOOD), which offers cryptocurrency trading alongside other financial services, recorded a sharper premarket decline of 5.8%.
The losses reflected the broader deterioration in sentiment towards cryptocurrency-related investments following the attack.
Shares of companies operating within the digital asset industry can be sensitive to changes in cryptocurrency prices, trading activity and investor confidence.
The latest security incident introduced additional uncertainty for businesses whose performance is closely linked to the adoption and trading of digital assets.
Investors Await Withdrawal Resumption and Further Security Updates
The immediate focus for cryptocurrency markets will be Binance’s progress in completing its security checks and restoring withdrawal services.
The exchange has indicated that withdrawals should resume within 48 hours and that it intends to absorb the financial losses associated with the incident.
Investors will also be monitoring whether additional stolen assets can be frozen or recovered through cooperation with stablecoin issuers and other industry participants.
Further information about the compromised device, the methods used by the attacker and the effectiveness of Binance’s security measures could influence confidence in the platform.
The incident has renewed concerns about operational vulnerabilities at major cryptocurrency exchanges, particularly as digital assets become increasingly integrated into mainstream financial markets.
Although Binance has pledged to protect customers from financial losses, the scale of the attack and the resulting disruption have placed renewed attention on cybersecurity standards across the cryptocurrency industry.