Binance Hack Rumor Sinks Crypto Market, Wipes Out Longs

This is a developing story and will be updated as more information becomes available.

Update (23:30 EET): Binance founder Changpeng Zhao said the transfers do look like a hack on Binance and that user funds are safe, while Tether and Circle froze about $971 million in USDT and $823 million in USDC linked to the incident. Binance itself has not yet issued an official statement.

• Binance founder Changpeng Zhao said the outflows look like a hack, as Tether and Circle froze linked stablecoins.
• Long positions took almost all of the forced liquidations, most of them within a single hour.
• BNB fell harder than any other top-ten coin, pointing to fear about the exchange itself.
• Hyperliquid stood out as the one large asset where short sellers carried the losses.

The crypto market extended its slide late on Thursday, October 29, after on-chain alerts flagged roughly $2.77 billion leaving Binance wallets across five blockchains and posts on X started describing the movement as a possible Binance hack, which would make it one of the largest exchange breaches on record. Binance founder Changpeng Zhao later said the movement does look like a hack, and stablecoin issuers Tether and Circle froze roughly $1.8 billion in tokens tied to it, although the exchange itself has not yet issued an official statement. The claims landed in a derivatives market packed with leveraged long bets, and CoinGlass liquidation data showed $620.41 million in forced closures within a single hour, out of $951.23 million for the full day. Bitcoin traded at $78,929 at the time of writing, while total crypto market capitalization stood at $2.67 trillion, down 1.69%.

How the Binance Hack Claims Took Shape

The claim gaining traction says a Binance wallet was emptied into a newly created externally owned account, a standard address controlled by a private key with no smart contract behind it, and that the gas for the contract call came from funds routed through Tornado Cash. That second detail is what turned a large transfer into a hack rumor. Exchanges usually pay fees for internal moves from their own labeled hot wallets, whereas attackers often seed fresh addresses through a mixer so the source of the gas money cannot be traced back to them.

The receiving address, 0x5227f603C1eE34CE3C06eFe6477003BDfCCB2f8c, was first funded by Binance 14, a long-standing labeled exchange wallet, and minutes later took in 28,005.6 ETH from another one, Binance 16. It now holds about 195,469 ETH worth roughly $452 million plus 63 tokens worth about $1.75 billion, and Etherscan puts its multichain balance at around $2.71 billion, which suggests most of the reported $2.77 billion landed in this one wallet across several EVM networks. The Tornado Cash link does not appear on this address’s own Etherscan record, so it may relate to another wallet in the chain of transfers. Funds sent directly from Binance’s labeled wallets point to compromised internal signing keys, which is consistent with Zhao’s assessment that the exchange itself was hit.

The freezes changed the picture within minutes. Tether blocked about $971 million in USDT and Circle about $823 million in USDC, and Zhao, who no longer runs Binance but remains a shareholder, said in a post on X that he expects all user funds to be fully covered. Stablecoin issuers can blacklist an address and stop its tokens from moving, while ETH and other native coins in the wallet cannot be frozen the same way, so the unfrozen portion is now the part investigators will follow. Anyone who wants to track the exchange’s balances can compare its own proof of reserves page with the independent DeFiLlama exchange transparency dashboard.

October has left traders primed to react before the facts arrive. The Drift Protocol exploit drained $285 million on Solana, Bitget lost up to $387.5 million from its hot and warm wallets in late September, and India’s CoinDCX admitted a $16 million loss days after first denying a fresh breach. With that record in mind, many traders cut exposure before Zhao’s comments and the freezes arrived.

Why One Hour Did Most of the Damage

A liquidation happens when a leveraged position loses enough value that the trader’s posted margin no longer covers it, at which point the exchange closes the position at market price. For a long opened at 20x leverage, a drop of about 5% is enough. Every forced sale pushes the price slightly lower and brings the next cluster of liquidation levels into range, so on thin order books the process can run through several layers in a matter of minutes.

Thursday’s numbers fit that pattern closely. Longs accounted for $599.62 million of the $620.41 million liquidated in the hour, roughly 97%, while the 24-hour tally showed $802.14 million in longs against $149.10 million in shorts. Positioning was fragile before the rumor surfaced: two Federal Reserve policymakers had backed a quarter-point rate increase at this week’s meeting, and Bitcoin had already slipped below $80,000 during the Asian session as technology stocks sold off, which left many dip buyers with liquidation prices sitting just under the market.

What makes the late-evening drop stand out is that Bitcoin had held around $80,000 through the US session while technology stocks sold off, even though it has tended to trade in step with the Nasdaq for most of the past few years. The Nasdaq Composite closed 1.38% lower after Alphabet’s results reopened the debate over AI spending, with the Google parent losing about 13% in its steepest one-day fall on record after reporting negative free cash flow of $9.07 billion and keeping its full-year capital expenditure forecast at $195 billion to $205 billion. Intel added to the pressure after the bell, falling about 18% in after-hours trading on a weaker revenue forecast, so crypto lost that relative calm just as the selling in big tech names deepened.

BNB Fell Hardest, HYPE Squeezed Shorts

BNB gives the clearest read on how the market priced the hack claims. The token dropped 5.99% in an hour and 6.95% over the day, the worst result among the ten largest cryptocurrencies, while Bitcoin lost 2.64% across the same 24 hours. BNB’s value is closely tied to activity on Binance and BNB Chain, so traders tend to sell it first when doubts emerge about the exchange, and its relative weakness says more about the impact of the hack claims than the broad market decline does.

Hyperliquid’s HYPE moved the other way and ranks among the day’s biggest gainers, up 13.73% over 24 hours and 19.02% over seven days. The token dipped alongside the rest of the market when the Binance claims surfaced, but buyers quickly recovered part of that drop, and it was the only large asset on the liquidation map where shorts absorbed most of the losses, with $25.55 million wiped out. The rally began well before the Binance claims appeared, so reading it as a flight from centralized exchanges would be a stretch, although traders will watch whether volume on the on-chain derivatives venue keeps climbing while the questions around Binance stay open.

What Binance Still Has to Explain

The missing piece is an official account from Binance. Co-CEOs Richard Teng and Yi He have not yet said how the signing keys behind Binance 14 and Binance 16 were accessed, how much was taken in assets that cannot be frozen, or whether the exchange will cover losses from its own reserves, as Zhao suggested. Withdrawal processing matters just as much, because an exchange that has lost funds typically pauses outflows on affected networks while it secures its remaining wallets.

On the trading side, the size of the flush has already removed part of the leverage that made it so violent. Funding rates, the periodic payments exchanged between long and short traders on perpetual futures, will show whether buyers start rebuilding positions at lower prices, and a move back above $80,000 would return Bitcoin to the range it held before the Fed meeting.

For scale, the October 10, 2025 crash liquidated about $19 billion across exchanges after new US tariffs and Chinese rare-earth export controls hit risk assets, which puts Thursday’s daily total at roughly one-twentieth of that event. The closest precedent for the hack itself is Bybit, which lost about $1.5 billion in ETH in February 2025 and kept withdrawals open while covering the shortfall with its own funds and loans from other firms, and traders will watch whether Binance handles a theft of potentially larger size the same way.