A severe blow to investor confidence hits Binance, the world's largest cryptocurrency exchange, as clients withdrew $3.64 billion within the first 9.5 hours of withdrawals being restored following the unprecedented cyberattack on October 29, during which digital assets worth $6.3 billion were stolen. Withdrawals corresponded to roughly 2.1% of the exchange's assets prior to the attack, according to data published by the Financial Times, highlighting the immediate impact of the security breach on customer trust. Specifically, during the first nine and a half hours following the restoration of withdrawals, clients withdrew approximately $4.65 billion while depositing $1.01 billion. This resulted in net outflows amounting to $3.64 billion. However, Binance announced that withdrawal volumes were stabilizing after the initial surge, while customer deposits remained at high levels as the exchange gradually restored its operations, driving Binance capital outflows.
Binance restores withdrawals after the theft
The world's largest cryptocurrency exchange began restoring withdrawal capabilities on Sunday (1/11/2026), having temporarily suspended its services due to the October 29 cyberattack. The gradual reopening included major cryptocurrencies such as Bitcoin, Ether, XRP, and Dogecoin, as well as selected stablecoins, including USDT and USDC. Binance announced it has replaced or recovered approximately 95% of the $6.3 billion in stolen digital assets by using corporate funds, its user protection reserve, an insurance fund, and resources from its treasury management fund. The remaining 5% concerns lower-liquidity cryptocurrencies, which, according to the company, may require more time to replace due to the difficulty of securing adequate quantities in the market. Binance committed to absorbing the financial cost of the breach itself without passing losses on to its clients, protecting crypto asset reserves.
Binance disputes higher outflow estimates
The surge in client withdrawals constitutes one of the first indications of whether the exchange will manage to preserve investor trust following what analysts have described as potentially the largest financial heist in history. Blockchain data analytics platform DefiLlama published higher estimates regarding outflows; however, Binance disputed those specific figures, maintaining that calculations included transfers between digital wallets controlled by the company itself. Binance insisted that withdrawals were gradually returning to normal levels and that deposit activity remained robust. The exchange announced that it manages assets worth approximately $171 billion and possesses 335 million registered users, a fact underscoring its importance to the global cryptocurrency ecosystem. According to Reuters, the incident also reignited concerns regarding the concentration of digital assets on centralized exchanges and potential consequences of severe operational disruptions, affecting centralized crypto exchanges.
FBI links Binance cyberattack to North Korean hackers
The US Federal Bureau of Investigation (FBI) attributed the attack to the TraderTraitor group, a hacker collective backed by the North Korean state that has previously been linked to major cryptocurrency thefts. The FBI announced that perpetrators had begun converting stolen cryptocurrencies into Ether and warned that new attempts to launder illicit proceeds through decentralized finance (DeFi) platforms and other cryptocurrency services might follow. The latest security breach drew comparisons to the February 2025 attack on the Bybit cryptocurrency exchange, which resulted in losses of approximately $1.5 billion. North Korea has repeatedly denied allegations that it utilizes state-linked cyber operations to steal digital assets. According to Binance's preliminary investigation, the attack may have originated from a compromised DevOps engineer's laptop. This could have allowed hackers to gain access to internal systems and execute unauthorized withdrawals. However, the exchange subsequently identified additional compromise points, indicating the incident was more complex than initially assessed. Binance continues its investigation in cooperation with law enforcement authorities and blockchain data analytics firms, shaping North Korean cybercrime.
www.bankingnews.gr
Readers’ Comments