Bitcoin dropped 1.76% to $78,484 on Thursday after Binance founder Changpeng Zhao disclosed that the world's largest cryptocurrency exchange may have been hacked, according to Bloomberg. "We are aware of reports of a potential security issue and we are actively investigating," a Binance spokesperson said, adding that the company had "not confirmed any impact to user funds" and that security systems remained operational.
The uncertainty triggered sharp deleveraging across crypto markets. CoinDesk reported that $356 million in long positions were liquidated as Bitcoin briefly fell below $80,000, while CoinMarketCap put the 24-hour liquidation figure at $444 million—the largest wipeout since September. Ethereum fell 2.67% to $2,246, with U.S. spot Ethereum ETFs recording $21.41 million in net outflows for their third consecutive day of redemptions, according to CoinMarketCap.
BNB, Binance's native token, bore the brunt of the exchange-specific concerns, plunging 5.04% to $712. Solana and XRP declined 1.72% and 2.53% respectively. Separately, prediction-market platform Polymarket paused trading after some users reported funds drained from their accounts, according to the Wall Street Journal. The issue stemmed from a security flaw in DebugBear, a performance-monitoring vendor used on Polymarket's website, and has been referred to U.K. law enforcement.
In a rare bright spot, Switzerland's SIX exchange launched the country's first spot Bitcoin ETF with an exemption from European fund concentration limits, CoinDesk reported. The product will be available to overseas brokers, marking a departure from stricter EU fund regulations. Meanwhile, Ethereum clients Teku and Besu released emergency security patches to fix a certificate vulnerability that could have redirected validator block rewards, according to CoinMarketCap.
Institutional crypto activity continued despite the volatility. BlackRock, SBI Holdings and Startale agreed on October 26 to explore connecting tokenized money-market funds to JPYSC, a yen-denominated stablecoin launched by SBI in June, according to The Block. On October 22, BlackRock issued approximately $150 million of sgBENJI, the token for its Singapore-domiciled dollar money fund, on the XRP Ledger. Polygon CEO Marc Boiron told The Block that the company is pivoting toward payments infrastructure and launching its Open Money Stack on Solana, signaling a strategic shift beyond its own blockchain.
Stock Markets
U.S. equities fell on Thursday, led by a sharp 2.6% decline in the Nasdaq Composite to 26,009 as investors questioned the sustainability of soaring artificial-intelligence spending, according to the Wall Street Journal. The tech-heavy index posted its largest single-day drop since June. The S&P 500 declined 1.21% to 7,663, while the Dow Jones Industrial Average edged down 0.37%.
The sell-off followed Wednesday's modest gains, when the S&P 500 rose 0.28% and the Nasdaq added 0.27% as investors digested the Federal Reserve's decision to hold interest rates steady, according to CNBC. Treasury yields dropped from recent highs on Thursday, offering little support to risk assets amid the AI spending concerns.
Gold & Commodities
Gold fell 1.32% to $368.57 as measured by the GLD ETF, while silver dropped 3.63% to $47.28. The declines came despite ongoing inflation pressures and geopolitical uncertainty. Natural gas tumbled 3.37% to $9.18.
Oil
U.S. crude oil rose 0.97% to $168.19 as measured by the USO ETF, supported by continued energy-market tensions. The Financial Times reported that tariff threats from the U.S. may have driven up prices, though the industry has shifted spending based on long-term demand expectations rather than short-term political developments.
Macro & Global Drivers
Inflation pressures intensified in the United States, with the personal-consumption expenditures price index rising 0.5% in September—up from 0.3% in August—according to the Wall Street Journal. The 12-month PCE inflation rate climbed to 3.6% from 3.4%, keeping pressure on the Federal Reserve after it held rates steady on Wednesday. Traders are pricing an 80% probability of a rate hike in December, according to Reuters.
In Europe, the European Central Bank warned that energy prices have continued to rise, posing upside risks to inflation and downside risks to growth, according to its October 29 monetary policy statement. The ECB noted that "the increased magnitude and duration of the energy shock, as well as the implications for indirect and second-round effects, are likely to drive up inflation and lower growth." U.K. inflation surged to its highest annual rate since March, driven by household energy costs and threats from the Iran conflict, the Wall Street Journal reported.
The Reserve Bank of Australia is preparing for potential rate hikes as traders brace for further tightening, according to Bloomberg. Central banks globally are navigating the tension between persistent inflation and slowing growth, with the ECB facing a critical leadership transition amid strains in European bond markets.
What to Watch Next
Binance's investigation findings will be critical for crypto sentiment, with any confirmation of a breach likely to trigger further selling. December Fed rate-hike odds stand at 80% following hotter-than-expected PCE inflation data, which could weigh on risk assets including digital assets. Ethereum client security patches and ongoing ETF outflows warrant monitoring for signs of stabilization or further stress.
Riza Ahnaf is an AI editorial persona used by Knightron Journal to represent content produced through Knightron's AI-assisted editorial workflow. Riza Ahnaf is not a real journalist, employee or founder; the name is an editorial identity, not proof of authorship by a real individual.
