Binance said on October 29, 2026 that attackers had stolen about $6.3 billion in crypto from its platform. Reporting describes it as the biggest crypto heist in history. The FBI has attributed it to North Korea. As of November 4, 2026, Binance says it will bear the loss itself.
For your US taxes, three questions matter. Is the hack a taxable event for you, do the frozen funds or the reimbursement create a deductible loss, and which records should you secure? Every hack figure carries a date. The story is still moving.
Key Takeaways
- Hack facts as of November 4, 2026: Binance puts the theft at about $6.3 billion.
- No taxable event: A hack at the exchange is generally not a disposal of your coins.
- Frozen funds are not your balance: The frozen funds of about $2.85 billion (as of November 3) are stolen crypto.
- No loss while Binance covers it: A deduction generally has no basis while Binance says it will bear the loss.
- Theft loss deductions are narrow: They generally need an investment purpose and no reasonable prospect of recovery.
- Binance.US: It says it was not affected.
What Is Known About the Binance Hack
Binance disclosed the incident on October 29. On October 31, the FBI named TraderTraitor, a North Korean hacking operation, as the perpetrator in an alert. North Korea has denied involvement. Binance paused withdrawals after the incident and began resuming them in phases on November 1.
The table shows the key figures as reported, with their status as of November 4, 2026. Outside researchers count a higher figure than Binance does, so the amount may still be revised.
| Item | Reported status |
|---|---|
| Amount stolen | About $6.3 billion (Binance: $6.34 billion) |
| Frozen or intercepted | About $2.85 billion (Binance, November 3) |
| Replaced by Binance | 98% of affected tokens (Binance, November 3) |
| Who bears the loss | Binance says it does |
| Binance.US | Says it was not affected |
The 98% figure means Binance bought replacement tokens with company funds, including its SAFU user-protection fund. It does not mean Binance recovered 98% of the stolen crypto from the attackers.
Is the Hack a Taxable Event for You?
The hack is generally not a taxable event by itself. The IRS digital asset question on Form 1040 covers receiving digital assets as a reward or payment. It also covers selling, exchanging or otherwise disposing of them. A hack at the exchange is none of these.
Gains and income you already realized stay taxable. Trades and rewards from before the hack generally follow the usual rules. So do trades you make after it.
Frozen Funds and Reimbursement: Does Either Create a Loss?
The $2.85 billion that Binance reported as frozen as of November 3 is not a frozen user balance. It consists of stolen assets frozen on the blockchain itself, among them assets frozen by the stablecoin issuers Tether and Circle. Reporting notes that returning frozen assets can take much longer than freezing them.
Binance says it will cover all losses from its SAFU fund and company funds. That matters: the US rules allow no theft loss deduction while a reimbursement claim has a reasonable prospect of recovery.
What does reasonable prospect of recovery mean?
It means you hold a genuine claim to be repaid, and there is a substantial chance that the claim succeeds. Whether this is true is a question of fact in each case. While it applies, you cannot deduct the affected amount. The deduction waits until the outcome is reasonably certain.
A theft loss is generally treated as sustained in the year you discover it. Binance's public promise to cover the loss points toward a reasonable prospect of recovery. A deduction is therefore generally not available while Binance's promise stands. A paused withdrawal does not change this, because a loss generally requires a completed, identifiable event. The same logic applied to the September 2026 Bitget hack, where a public reimbursement promise also made a deduction unlikely.
Keep your own record of what you held
CoinTracking imports your Binance history, so you can show what you held if you ever need to.
When a Theft Loss Deduction Could Still Apply
A deduction becomes a real question only if Binance does not repay you in full. That could happen if reimbursement is denied or covers only part of your balance. Binance's statements as of November 4, 2026 do not describe such a case. Ordinary losses from selling or swapping crypto at a lower price follow different rules, which our guide to reporting crypto losses explains.
The reason you held the coins would then decide the outcome. The same applies to victims of the 2026 DeFi bridge hacks. Since 2018, theft losses on personal-use property are generally deductible only if a federally declared disaster caused them. From 2026, state-declared disasters count as well. A hack at an exchange is not a disaster, so a personal-use loss would not qualify.
Crypto you hold as an investment is treated differently. According to a 2025 Chief Counsel memo on scam victims, a theft loss is allowed with a profit motive and denied without one. You generally deduct it in the year of discovery, once no reasonable prospect of recovery exists.
The IRS has not addressed whether a breach at an exchange counts as theft of your own coins. That memo covered scam victims only.
The deduction is capped at your cost basis, which is generally your purchase price. The market value of the stolen coins does not count. You cannot deduct income or unrealized gains that were never included in your gross income.
The example uses assumed numbers and ignores fees: you bought coins for $10,000, and they were worth $25,000 when you lost them.
| Step | Amount |
|---|---|
| Cost basis | $10,000 |
| Market value at loss | $25,000 |
| Maximum theft loss | $10,000 |
The $15,000 of unrealized gain gives you no deduction, so your cost basis is the number to protect.
Suppose you deduct a loss and Binance repays you in a later year. The repayment generally counts as income in the year you receive it. That holds only to the extent the earlier deduction lowered your tax, and you do not recompute the earlier year.
Before you claim anything, talk to a tax professional. If you want help with a complicated history, the CoinTracking Full-Service team prepares your tax report for you.
How to Export and Archive Your Binance History
The IRS says to keep records of your purchases, sales, exchanges and other dispositions. That includes the dollar value of any digital assets you received as income. Our guide to reconstructing missing cost basis helps if parts of your history are missing.
- Export from Binance: Binance's help center describes the path Assets, Asset History, Export Transaction Records. Preset ranges cover the past 6 months, and older periods need a custom date range.
- Mind the limits: Binance caps the number of statements per month, and a download link expires after 7 days. Check your own quota on the live help page.
- Import into CoinTracking: The CoinTracking Binance import works with a read-only API key or a CSV upload.
- Snapshot your balances: Save dated screenshots of your balances and of any official Binance notice.
- Keep correspondence: Keep every message about withdrawals or reimbursement together with its date.
Archive your Binance history in minutes
CoinTracking imports your Binance transactions through an API connection or a CSV upload, so your history is stored in one place.
What Binance.US Users Should Know
Binance.US said on October 29, 2026 that it was not affected by the incident. It described itself as a separate, independent platform and said customer funds and services are secure and operating normally.
If you only use Binance.US, the hack generally changes nothing on your tax return. Your trades stay taxable under the usual US rules. You can import your history through the Binance.US import, via API or CSV upload. For your account on Binance's global platform, a deduction generally depends on repayment and on your reason for holding the coins.
Conclusion
If Binance repays you in full, the hack generally changes nothing on your tax return. Export and archive your history, and revisit the question if Binance's statements change.
Be ready for whatever comes next
CoinTracking has tracked crypto portfolios and calculated taxes for over 2.2 million users since 2012, across 400+ exchanges, wallets, and blockchains. Import your history once, and your records are ready whatever happens next.
Disclaimer
The information provided in this article is intended for general informational purposes only and should not be construed as financial, tax, or legal advice. The facts about the Binance incident are stated as of November 4, 2026 and may change as the investigation and Binance's reimbursement continue. Tax treatment depends on your individual circumstances and on current law, which can change. Consult a qualified tax professional before you make decisions based on this article. The author and publisher are not responsible for any losses or damages incurred as a result of using the information in this article.
