Bitcoin ETFs Hit by $643M Selloff as Binance Hack Shakes Crypto

Spot Bitcoin ETFs swung from more than $440 million in net inflows over the first four trading days of the week to over $643 million in outflows on Friday, leaving about $203 million in net weekly outflows. Ethereum ETFs had roughly $432 million in weekly outflows, with withdrawals on every trading day. The timing of the selling may reflect concern about the Binance hack, but the flows alone cannot establish what motivated investors.

TRM Labs attributes the Binance attack to North Korea’s “trader-trader unit,” according to Ari Redbord. He said about $6.4 billion was drained across 10 blockchains, mostly within roughly 20 minutes, making it unprecedented in scale. Redbord called it “the largest bank robbery in human history,” compared it with the $1.5 billion Bybit hack in February 2025, and noted that North Korea’s economy is about $20 billion or more.

Binance said it would cover users’ losses and had begun reopening crypto services in phases. Redbord said the exchange could likely make users whole, but Tim Grant cautioned that questions about recovering funds and repaying users remained unanswered. Grant said the market was not out of the woods and expects ETF flows over the next few weeks to help show whether institutions absorb the shock or continue withdrawing.

Redbord said Tether and Circle took back about 40% of the stolen assets in the attack’s early moments, using capabilities he linked to the Genius Act. He also said the Beacon Network enabled near-real-time action by almost every exchange it worked with during the preceding 36 to 72 hours. Binance’s explanation of how the breach happened was still emerging: the host said TRM’s evidence pointed to compromised hot-wallet signing, while Binance had discussed an engineer’s compromised laptop. Redbord deferred to Binance on the cause.

Google Cloud’s Rich Widman described a multi-party-computation key-management service for institutions, in which a private key is not stored in one location or recomposed during signing. He said many private-key hacks might have been prevented with this approach, while stressing that whether it applies to Binance depends on the eventual findings. Jensen Assy said the market reaction to the hack appeared muted compared with past incidents. Grant also noted Morgan Stanley cut Coinbase’s price target from $258 to $120, citing weak earnings, but questioned whether the downgrade indicated broader weakness in crypto.

The discussion also addressed AI computing demand: the speaker expects continued growth in AI tools, models, and workflow use, but said smaller AI labs and larger companies are seeking capacity now rather than purchasing three or four years of offtake in advance. A shakeout among larger providers is already beginning, with its depth partly dependent on the rate environment; the speaker warned that many companies could be caught out, while less-leveraged smaller neoclouds may benefit and cheap assets may emerge.