Binance Hack: $6.3B Damages & Attack Details

The largest exchange hack in the history of the cryptocurrency industry, targeting Binance, has resulted in damages of approximately $6.3 billion. Currently, about $3 billion of the stolen assets are frozen on-chain.

Incident Scale and Exchange Response

Binance has suspended all deposits and withdrawals, promising to cover losses from its SAFU fund and own reserves. The company confirmed the security of user funds and plans to update its Proof of Reserves after resolving the aftermath.

Changpeng Zhao, former CEO and current shareholder of the platform, thanked Tether and Circle for the swift freezing of assets. Preliminary data indicates that around $971 million in USDT and $823 million in USDC were blocked.

Elon Musk commented on the situation with the phrase "Everyday is Zeroday," highlighting the constant presence of zero-day vulnerabilities in cybersecurity.

Technical Details of the Attack

The attack began on October 29 at around 20:20 UTC. The hacker exploited the EIP-7702 function from Ethereum's Pectra update, which allows a standard wallet to temporarily act as a smart contract. This enabled the attacker to replace the code of Binance Hot Wallet 14.

The attacker did not hack the Ethereum network but gained access to the exchange's wallet management systems. To bypass defenses, they pre-prepared about 50 authorizations with sequential nonces and sent them simultaneously, hoping for a match with the current value.

A significant amount of assets was withdrawn from the wallets:

Binance 14: approx. $2.5 billion (167,464 ETH and $1.6 billion in USDT)
Binance 16: 28,006 ETH
Hot Wallet 34: $823 million in USDC

The total volume of withdrawn funds across the Ethereum networks amounted to $3.3–3.5 billion. Assets were also withdrawn via Bitcoin and Tron networks. The hacker actively swapped stablecoins for ETH to obfuscate the trail.

Market Impact and Partners

The $6.3 billion damage is roughly four times higher than the previous record hack of Bybit ($1.5 billion). This represents about 4.4% of all assets held by Binance. Bitcoin briefly dropped below $77,000.

Among the exchange's partners, Wintermute and GSR were affected. However, their losses are limited: less than 20% of net capital for Wintermute and less than 5% for GSR. Operational activities of these partners will not be disrupted.