Binance Faces 6.3 Billion Dollar Hack Amid French Regulatory Ban
Binance suffered a 6.3 billion dollar security breach on October 29, 2026, forcing the world’s largest cryptocurrency exchange by volume to freeze all deposits and withdrawals. jechange.fr reported that the platform tapped its emergency fund, known as SAFU, alongside corporate reserves to cover the losses. The incident unfolded just four months after Binance lost its legal authorization to operate in France under European cryptocurrency regulations.
The attack began at 20:20 UTC on Thursday, when an attacker submitted an Ethereum transaction containing 50 authorizations targeting Binance 14, a hot wallet connected to the internet for routine customer withdrawals, according to france-epargne.fr. A single authorization succeeded, linking the wallet to a malicious contract that transferred out 167,464 ethers, over 1.6 billion tethers, and dozens of other tokens. Attackers utilized the EIP-7702 function on Ethereum, which allows ordinary wallets to delegate transaction execution to smart contracts. Binance 14 was drained of roughly 2.5 billion dollars by 20:24 UTC, with stolen funds moving through Tornado Cash before spreading across the Bitcoin, Tron, Arbitrum, and Avalanche networks.
DevOps Compromise and Stolen Funds
Initial investigations by Binance suggest the security breach stemmed from a compromised DevOps engineer’s laptop, which allowed an attacker to access a service container and issue unauthorized withdrawal orders. The platform confirmed it found no evidence of private key leaks from its core wallets. Security firm Blockaid, which detected the attack within two minutes, pointed instead to a stolen key.
Roughly 3 billion dollars of the stolen assets were quickly frozen on the blockchain. Tether Chief Executive Officer Paolo Ardoino announced that his company froze over 1.567 billion USDT linked to the hack. Circle Chief Executive Officer Jeremy Allaire confirmed that his firm immobilized more than 800 million USDC in coordination with law enforcement. Meanwhile, the Arbitrum Security Council moved 74,559,805 ARB tokens and 8,425 ethers from an address tied to the attack into a restricted wallet. However, ether stolen directly on the Ethereum network escaped freezing mechanisms because ether lacks an issuer capable of blacklisting addresses.
French Operations Under Degraded Mode
The hack compounds regulatory pressure on Binance in France, where the platform lost its right to offer services on July 1, 2026. The European Union’s Markets in Crypto-Assets regulation, known as MiCA, required digital asset providers to secure an operating license by the end of its transition period on June 30, 2026. Binance announced on June 24 that none of its corporate entities would obtain the license in time, terminating its prior registration with the Autorité des marchés financiers.
French customer accounts have since operated in a degraded mode. Users cannot open new accounts, deposit euros, buy crypto, or earn staking yields. Only position reductions and withdrawals to bank IBANs or external wallets remain active. While MiCA imposes strict liability on licensed providers for customer losses resulting from hacks, those protections do not apply to Binance due to its lack of European authorization.
Recovery Timeline and Outstanding Proof of Reserves
Binance announced a target to resume withdrawals within 40 hours, pointing toward a recovery by the morning of November 1, 2026. The platform committed to covering all losses using 15,000 bitcoins held in its Secure Asset Fund for Users and corporate cash reserves. Markets reacted negatively to the breach, with Binance native token BNB leading a broader cryptocurrency market decline.
Questions remain regarding the platform’s solvency and the true scope of unrecovered assets. Binance promised to publish a proof of reserves report to verify what it holds against customer liabilities. TRM Labs attributed the attack to the TraderTraitor group, a collective previously linked by the FBI to a 1.5 billion dollar theft from Bybit in February 2025. Law enforcement agencies have not formally named a responsible party for the Binance breach.
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