Bitcoin attempts rebound towards $80,000 after Binance hack

The $6.3 billion theft suffered by Binance led to over $1.5 billion in crypto market liquidations. The extent of the fall, however, does not come only from piracy, because the massive use of leverage and the decline in technological stocks amplified the initial shock.

$1.31 billion in bullish bets swept away in 24 hours

Bitcoin fell to $76,320 on October 30, its lowest level in several weeks. This fall came after Binance confirmed an attack that allowed the unauthorized withdrawal of $6.3 billion in crypto.

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

The main figures show how fear spread to leveraged markets:

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

These liquidations do not correspond to funds directly stolen from Binance. They designate trading positions automatically closed because the guarantees posted by their holders were no longer sufficient to cover their losses.

This mechanic explains the speed of movement. The first sales, caused by fear of a broader crisis, caused prices to fall. The decline then reached the liquidation thresholds of bullish traders, forcing platforms to sell more assets. These new sales triggered other automatic closings, fueling the spiral.

The fall of tech reinforced the shock caused by Binance

Hacking is the main trigger, but it does not alone explain the violence of the correction. Risky assets were already weakened by the decline in American technology stocks, after several results and forecasts considered disappointing.

Alphabet lost about 13% after missing market expectations on its revenue and earnings. Intel for its part fell 26% before the opening of Wall Street. The chipmaker expects quarterly sales of between $15 billion and $16 billion, while analysts expected between $17 billion and $18 billion.

This stock market correction reduced the appetite for risk at the precise moment when the Binance attack was shaking confidence in crypto platforms. Investors exposed simultaneously to technologies and cryptos were thus pushed to reduce their positions.

The ratio between the amounts illustrates the multiplier effect of leverage. The $1.56 billion liquidated represents nearly a quarter of the $6.3 billion stolen. However, there is no indication that all of the stolen funds were sold on the market. Part of it was frozen, while Binance promises to cover the remaining losses with its SAFU fund and its reserves.

The fall therefore comes less from the direct sale of stolen cryptos than from a brutal reassessment of risk. Fear was enough to cause prices to fall to areas where automatic mechanisms accelerated the movement.

Bitcoin attempts a rebound

After touching $76,320, bitcoin rose above $77,000, then briefly towards $78,400. Several indicators show that selling pressure could start to slow.

The daily RSI fell to 34.7, its weakest level since June 30. It is thus approaching the oversold zone located below 30. On the four-hour chart, the indicator has formed a bullish divergence. The price made a new low, while the RSI formed a higher low. This configuration may signal a weakening of sellers.

Bitcoin also closed below the lower Bollinger band, more than two standard deviations from its twenty-day moving average, located around $81,324. Such a large gap can encourage a return to this average, but does not guarantee a lasting recovery.

What happens next now depends on the complete 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 could be involved.

A rebound towards 80,000 or 81,300 dollars therefore remains possible. As long as the investigation has not clarified the extent of the hacking, this rise will, however, look more like a technical recovery after the liquidations than a real return of confidence.