More Than $2.38 Billion Frozen After Binance Investigates Possible Hack
Key Facts
Binance said it was investigating reports of a potential security issue and had not confirmed any impact on user funds as of its statement, before adding that their funds were safe. In contrast, co-founder Changpeng Zhao described the incident as "looking like a hack" and said he expected user funds to be fully covered as a shareholder. Reuters reported that Tether and Circle together froze more than $2.38 billion in stablecoins linked to the incident. Tether announced it had frozen about $1.57 billion, while Circle said it had frozen more than $800 million in USDC. These figures put stablecoin issuers’ response at the center of the investigation, while the value of frozen assets is not a final estimate of losses.
Freeze estimates evolved over the day as companies and on-chain trackers released additional data. Tether’s chief executive said the company had frozen more than 1.567 billion USDT, while on-chain data showed that Tether and Circle together froze $1.79 billion worth of USDT and USDC in the receiving wallet. Circle’s chief executive said his company had frozen more than 800 million USDC. The figures reflect different measures: the value of tokens identified by type, the total dollar value tracked by on-chain data, and the companies’ announcements of freeze actions. Binance co-founder Yi He also said Ripple had frozen about $200 million more.
On-chain data showed about $3.55 billion in transfers into an unidentified wallet on October 29, of which about $900 million was later moved to other wallets. Blockaid said it was investigating about $3.3 billion in suspicious outflows from Binance hot wallets across Ethereum, Arbitrum and Avalanche. Arkham values the assets in a wallet linked to the incident at more than $5.7 billion, including nearly $1.5 billion in Bitcoin and $900 million in Ether. This is the estimated value of assets held in the wallet, not a confirmed loss amount. These figures remain part of efforts to track fund movements as Binance’s investigation continues.
Zhao, who no longer runs Binance.com, said he expected user funds to be fully covered, The Block reported. Reuters said Binance.US, a platform separate from Binance, said it was not affected by the security incident. Reuters also reported, citing the company’s website, that Binance has more than 335 million registered users worldwide. As background on its response efforts, Binance said it had secured or frozen more than $73 million in user funds stolen in external hacks through July 31, 2024, compared with about $55 million in 2023. This is a previously announced company figure, not an estimate of what was recovered in the current incident.
Risk-mitigation measures included the Aave protocol, which froze lending markets to prevent the entity linked to the incident from borrowing, according to on-chain data. The move does not guarantee the recovery of funds, but it limits the ability of the wallet linked to the incident to use lending markets on the protocol. Binance said its user protection fund, SAFU, has a target reserve of $1 billion after announcing its conversion to Bitcoin in February 2026. The company added that it would rebalance the fund to $1 billion if its market value fell below $800 million because of Bitcoin volatility. Binance had said the fund held $1 billion in USDC in January 2026, meaning its later-announced plan tied the reserve’s valuation to Bitcoin’s price.
The reports coincided with a broad decline in the market snapshot published by CoinDesk on October 29. Bitcoin fell about 3% to nearly $78,800, Ether dropped about 4%, while BNB declined 6.7%. The Block said BNB was down more than 5.5% at the time its report was published, reflecting a different point in time. BNB posted the largest decline among the three assets cited in CoinDesk’s snapshot as reports of the security issue spread. Price moves alone do not prove that the incident caused the decline.
Binance’s statement that it had not confirmed any impact on user funds as of its announcement, followed by its statement that their funds were safe, remains the company’s position in the early hours of the investigation. The value of frozen assets and the contents of the wallet remain separate issues from determining the actual loss or the fate of transferred funds. Across the sector, losses from cryptocurrency exchange hacks rose 21% to $2.2 billion in 2024, according to the Chainalysis report cited by Reuters, while the number of incidents increased to 303 from 282 in 2023. These figures provide context for the market’s sensitivity to security incidents, but do not determine the outcome of the current investigation. The statements cited did not include a specific timetable for the investigation’s findings or a final estimate of losses.