Coinkarma founder Benson Sun said the latest Binance hack is unlikely to create meaningful near-term selling pressure from the stolen Bitcoin, while ETH may be the asset more likely to feed into the market.
According to Sun, Binance has officially confirmed that about $2.5 billion in assets have been frozen, accounting for roughly half of the total amount stolen. The remaining assets are mainly Bitcoin and ETH.
He said the stolen Bitcoin is worth more than $1 billion, but is much harder to cash out than ETH because Bitcoin does not have a deep mixing pool comparable to Tornado Cash. Addresses tied to the theft are also likely to be flagged by trading platforms and blockchain analytics firms.
Sun cited the 2016 Bitfinex hack, where stolen Bitcoin remained unmoved for years. He also pointed to the theft of about 1,800 BTC from Coldcard in July this year, saying roughly 90% of those funds were still unmoved as of early September.
Given the larger scale of the Binance incident, he said any effort to split addresses, mix funds, and sell them at a discount through OTC desks could take years. In his view, near-term selling pressure from the stolen BTC is close to zero.
He added that if Binance uses its Secure Asset Fund for Users, or SAFU, to compensate users and then buys back Bitcoin, that could instead create buying demand.
By contrast, Sun said large amounts of ERC-20 tokens can be swapped into ETH and then moved through Tornado Cash, making them harder to trace. He said the portion that could actually turn into market selling pressure may be in the range of more than $1 billion.
Sun added that the incident could hurt market confidence, but the direct selling pressure on Bitcoin is not as large as many may think. He also called on the industry to pay closer attention to hot wallet management, signing authorization, and post-AI-era security planning including quantum-resistant measures.