Bitcoin Attempts Recovery After Binance Security Breach

The theft of 6.3 billion dollars suffered by Binance led to more than 1.5 billion dollars in liquidations on the crypto market. However, the magnitude of the drop is not only due to the hack, as the massive use of leverage and the decline of technology values amplified the initial shock.

1.31 Billion Dollars of Long Bets Wiped Out in 24 Hours

Bitcoin fell to 76320 dollars on October 30th, its lowest level in several weeks. This drop happened after Binance confirmed an attack that allowed the unauthorized withdrawal of 6.3 billion dollars in crypto.

The platform’s initial investigations point to the compromised computer of a DevOps engineer. The hacker allegedly used this access to trigger withdrawals. Binance claims to have revoked the relevant permissions, temporarily suspended deposits and withdrawals, then contacted authorities and several blockchain analysis companies.

The main figures show how fear spread to leveraged markets :

• Liquidations reached 1.56 billion dollars in 24 hours ;
• Long positions represent 1.31 billion, or 84% of the total ;
• Nearly 500 million dollars of bitcoin positions were closed ;
• Long position liquidations in BTC reached 405 million dollars ;
• Ethereum recorded over 300 million dollars of long liquidations ;
• About 3 billion dollars of stolen funds have allegedly already been frozen.

These liquidations do not correspond to the funds directly stolen from Binance. They refer to trading positions automatically closed because the collateral deposited by their holders was no longer sufficient to cover their losses.

This mechanism explains the speed of the movement. The initial sales, caused by fear of a broader crisis, pushed prices down. The decline then reached the liquidation thresholds of bullish traders, forcing platforms to sell more assets. These new sales triggered other automatic closures, feeding the spiral.

The Tech Drop Intensified the Shock Caused by Binance

The hack was the main trigger, but it alone does not explain the severity of the correction. Risk assets were already weakened by the decline of U.S. tech stocks after several results and forecasts were considered disappointing.

Alphabet lost about 13% after missing market expectations on its revenue and profits. Intel fell by 26% before Wall Street opened. The chip manufacturer projects quarterly sales between 15 and 16 billion dollars, while analysts expected between 17 and 18 billion.

This stock correction reduced the appetite for risk at the exact moment when the Binance attack shook confidence in crypto platforms. Investors exposed simultaneously to tech and crypto were thus pushed to reduce their positions.

The relationship between the amounts illustrates the multiplicative effect of leverage. The 1.56 billion dollars liquidated represent nearly a quarter of the 6.3 billion stolen. However, there is no indication that all the stolen funds were sold on the market. A part has been frozen, while Binance promises to cover the remaining losses with its SAFU fund and reserves.

The drop is therefore less due to direct sales of stolen cryptos than a brutal reassessment of risk. Fear was enough to push prices down to zones where automatic mechanisms accelerated the movement.

Bitcoin Attempts a Rebound

After touching 76320 dollars, bitcoin rose above 77000 dollars, then briefly to 78400 dollars. Several indicators show that selling pressure might start to slow down.

The daily RSI dropped to 34.7, its lowest level since June 30. It thus approaches the oversold zone below 30. On the four-hour chart, the indicator formed a bullish divergence. The price marked a new low, while the RSI formed a higher low. This setup can signal a weakening of sellers.

Bitcoin also closed below the lower Bollinger band, more than two standard deviations away from its 20-day moving average, located around 81324 dollars. Such a gap may favor a return towards this average but does not guarantee a sustainable recovery.

The future now depends on the full reopening of withdrawals at Binance, the recovery of funds, and the absence of new breaches. The platform called the attack “complex” and acknowledges that multiple intrusions might be involved.

A rebound towards 80000 or 81300 dollars is therefore still possible. As long as the investigation has not clarified the extent of the hack, this rise will look more like a technical recovery after the liquidations than a true return of confidence.