Key Takeaways
- Coinbase, Strategy, and other prominent stocks fell Friday as crypto and AI-driven tech selling hit risk assets.
- Binance said a $6.3 billion breach hit its assets, with about $3 billion frozen and losses to be covered.
- Strong quarterly profits failed to shield crypto stocks from a rapidly worsening risk backdrop.
Binance Hack Adds a Crypto-Specific Shock
Crypto stocks are being hit from both sides.
Coinbase (COIN) shares fell 12.4% to $140.70 as of this writing, while bitcoin treasury giant Strategy (MSTR) dropped more than 6% to $132.20. The selloff spread across the sector, with Securitize (SECZ) down 8.7%, American Bitcoin (ABTC) falling 9.3%, Bullish 9.2%, Circle 8.3% and Galaxy Digital 8.1%.
The rout came as bitcoin briefly fell toward $76,000 Friday morning following a security breach at Binance on Thursday, while renewed anxiety over the cost of the artificial-intelligence boom pressured technology stocks. More than $1.5 billion of leveraged crypto positions were liquidated over 24 hours. Bitcoin has since ticked back up to just under $77,900, showing a nearly 5% drop in the last day.
Binance estimates the incident affected about $6.3 billion of assets after an attacker apparently gained access through a compromised employee laptop and submitted unauthorized withdrawals.
The exchange said roughly $3 billion has been frozen onchain and that it will cover losses using its Secure Asset Fund for Users (SAFU) and corporate resources. Binance said it found no evidence that private wallet keys were compromised.
That shock landed during an already fragile session for risk assets.
Concerns over huge AI infrastructure spending intensified after Alphabet suffered a 13% decline on Thursday, while Amazon and Intel results added to questions about how quickly companies can generate returns on massive AI investment. Intel shares are down more than 28% so far on Friday following an underwhelming earnings report.
Coinbase Earnings Fail to Shield the Stock
After the close of trading Thursday, Coinbase reported $719 million in Q3 net income, but adjusted net income was only $78 million after stripping out investment and crypto-asset gains. Adjusted EBITDA reached $333 million, up 60% sequentially.
Underlying trading conditions remained softer than a year ago. Transaction revenue fell to $590 million from about $1 billion, while total revenue declined to $1.22 billion from $1.87 billion.
The stock’s decline Friday morning—sharper than other major crypto stocks—suggests investors are looking beyond the headline profit toward crypto-market weakness and future trading activity.
Strategy Falls Despite $19.5 Billion Profit
Strategy also posted eye-catching results, reporting $19.53 billion of net income and $44.75 in diluted earnings per share, largely reflecting gains on its bitcoin holdings.
The company held 848,517 BTC as of Oct. 25, while quarterly revenue slipped 3% to $125.4 million. Friday’s declines show why crypto equities can amplify moves in the underlying market.
Bitcoin weakness is pressuring their core exposure, the Binance hack has revived security concerns, and the AI-led technology selloff is hitting the same high-beta investor base.
For Coinbase and Strategy, strong backward-looking earnings were not enough to offset a rapidly deteriorating risk environment.
