Major Withdrawals from Bitcoin ETFs Following Historic Binance Hack

Investors Withdraw $643 Million from Bitcoin ETFs Following Major Binance Hack

October 30, 2023

In a dramatic turn of events for the cryptocurrency market, investors pulled a staggering $643.33 million from U.S. spot Bitcoin exchange-traded funds (ETFs) on October 30, according to data from SoSoValue. This mass withdrawal came just a day after hackers executed a historic breach, siphoning approximately $6.3 billion from Binance, the world’s largest cryptocurrency exchange.

Bitcoin ETFs, which allow investors to own Bitcoin similarly to stocks, currently hold assets totaling $98.14 billion. The recent outflow snapped a four-day streak of inflows, raising concerns about investor confidence in the wake of the Binance hack.

Which Bitcoin ETFs Lost the Most Money?

Among the hardest hit was BlackRock’s iShares Bitcoin Trust (IBIT), which saw a loss of about $234 million. Funds managed by Fidelity and Ark Invest also experienced significant exits, contributing to the overall decline in ETF assets. When investors cash out, large trading firms return fund shares in exchange for Bitcoin or cash, leading to a decrease in the coins available for sale on the open market.

In addition to Bitcoin, Ethereum (ETH) funds faced their own challenges, losing another $156 million on the same day, marking their fifth consecutive day of outflows.

How Big Was the Binance Hack?

The Binance hack, which occurred on October 29, was unprecedented in scale. An attacker managed to transfer roughly $6.36 billion out of Binance’s exchange wallets across ten blockchains, with most of the funds disappearing in about 20 minutes. Analytics firm TRM linked the theft to TraderTraitor, a North Korean hacking unit, making this breach four times larger than the previous record set by the Bybit hack in February 2025.

In response to the breach, Binance suspended deposits and withdrawals, assuring users that their funds remain secure. Token issuers and network operators have since frozen about $2.7 billion of the stolen assets, according to TRM.

Is One Day of Withdrawals a Warning Sign?

The $643 million withdrawal represents approximately 0.7% of the total assets held in Bitcoin ETFs. A similar exit occurred on October 22, when investors withdrew $635 million in a single session. However, inflows returned for four consecutive days starting October 26, suggesting that market sentiment can shift rapidly.

Historically, significant hacks have led to heavier selling. Following the Bybit theft, investors pulled a then-record $1 billion in a single day, with total outflows nearing $3 billion that week.

Is Bitcoin Headed for a Second Losing October?

As of October 30, Bitcoin’s price stood at $77,189, down 1.7% in the last 24 hours. Approximately $11 billion in Bitcoin options also expired on the same day. Monthly data indicates that Bitcoin is down 7.3% for October so far, following a 3.95% decline in October 2025. Notably, back-to-back losing Octobers have only occurred once before, in 2011 and 2012.

For fund holders, the coming sessions will be crucial in determining whether the recent outflows are a temporary blip or a sign of deeper market instability. As the crypto landscape continues to evolve, investors will be watching closely to see how the fallout from the Binance hack impacts future trading.

Read the original story by Lockridge Okoth at BeInCrypto.com.