Wall Street expects crypto market to recover quickly from Binance hack

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Falling stocks could create opportunities for investors

The selloff following the Binance hack affected not only cryptocurrencies but also shares of companies involved in digital assets. On Friday, Coinbase and Strategy shares fell approximately 12%, while Robinhood dropped around 9%.

Despite the decline, the Cantor Fitzgerald analyst expects stock prices to recover once the initial panic subsides. In his view, falling valuations of crypto-related companies could create attractive buying opportunities.

TD Cowen analyst Lance Vitanza expressed a similar opinion. He emphasized that the hack exposed weaknesses in Binance's security systems but did not undermine the reliability of Bitcoin itself or other blockchains.

"We do not stop using dollars when a bank is robbed, just as car theft does not invalidate the automobile," Vitanza wrote.

According to preliminary findings, the attackers targeted Binance's transaction-signing infrastructure rather than the Bitcoin network. Vitanza therefore sees the current market decline as a potential opportunity to increase exposure to Bitcoin and shares of companies that hold the cryptocurrency on their balance sheets.

Can Binance cover the losses?

Compass Point analysts Ed Engel and Michael Donovan believe Binance has sufficient financial resources to compensate affected customers.

According to their estimates, the exchange holds approximately $1.2 billion in excess USDT reserves, around $1.2 billion in Bitcoin reserves, and more than $1.5 billion in USDC treasury assets.

"We believe Binance has more than enough liquidity to cover the hole," the analysts said.

However, compensating customers could put additional pressure on the market. Compass Point warned that stablecoin supply could come under pressure as Binance reimburses affected users. Withdrawals from decentralized lending protocols could also increase once cryptocurrency services resume normal operations.

The analysts also believe some Binance customers may move to competing platforms. Potential beneficiaries include centralized exchanges Coinbase and Bullish, as well as decentralized trading platform Hyperliquid, where users can trade without handing custody of their assets to an exchange.

Bitcoin approaches a key price level

Following the Binance hack, Bitcoin fell to approximately $76,600. Compass Point analysts identify the $75,000–$77,000 range as an important support zone that could determine the cryptocurrency's next move.

A break below these levels could threaten Bitcoin's recent recovery. However, analysts currently see no signs that Binance's problems could trigger a systemic crisis comparable to the turmoil of 2022.

"Overall, this is painful, but it is not 2022," Cantor Fitzgerald analyst Ramsey El-Assal concluded.

As a reminder, details of the largest theft in crypto industry history emerged earlier.

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