Ethereum supply on exchanges falls after Binance attack, liquidity concerns rise

A recent decline in the supply of Ethereum held on major exchanges has been observed, following a security breach at Binance on October 29. On-chain data suggest that this withdrawal may be linked more to a reduction in market liquidity rather than an immediate panic reaction. Between October 28 and November 2, the share of Ethereum reserves held on exchanges decreased from 3.56% to 3.20% of the total ETH supply. More than half of this 0.36 percentage point drop occurred on October 29, the day the Binance attack was disclosed. TRM Labs, a blockchain analytics firm, reported that attackers withdrew approximately 200,630 ETH from Binance’s hot wallet during the incident. However, the ETH balance in the largest exchange wallets did not decline immediately on October 29.

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