Wall Street Firms Suggest Bitcoin Proxies as Crypto Hack Alternative

Analysts Urge Buying Crypto Stocks After Record Binance Hack

Wall Street analysts are advising clients to view the record-breaking hack of Binance not as a reason to exit the market, but as a buying opportunity, encouraging investors to acquire cryptocurrency-linked stocks while prices are depressed.

Research notes released Friday by analysts at Cantor Fitzgerald, TD Cowen, and Compass Point indicated that the approximately $6.3 billion theft, the largest cryptocurrency hack on record, is unlikely to derail the broader market’s recovery. This reassurance emerged a day after the exploit sent shockwaves through markets and caused Bitcoin to slide toward $77,000.

Cantor’s Ramsey El-Assal highlighted the swift industry response to contain the damage. He noted that stablecoin issuers and other entities froze roughly $3 billion of the stolen funds, with Tether blocking over $1.5 billion, Circle approximately $800 million, and Ripple around $200 million. El-Assal anticipates that shares of Coinbase, Robinhood, and Strategy will rebound once the initial panic subsides. “We would be buyers on weakness,” he stated, adding that while the event is difficult, “this is not 2022.”

Lance Vitanza of TD Cowen echoed this sentiment, arguing that the breach exposed security vulnerabilities within Binance itself rather than flaws in the underlying technology of Bitcoin. He framed the subsequent selloff as an opportunity to increase holdings in Bitcoin and the stocks of publicly traded companies that possess it.

Compass Point’s Ed Engel and Michael Donovan asserted that Binance possesses “more than enough liquidity to cover the hole.” However, they cautioned that reimbursing customers could strain stablecoin supply and that rivals such as Coinbase and Hyperliquid might gain market share. They are closely monitoring the $75,000 to $77,000 range for Bitcoin as a critical level.

The rationale for favoring stocks over direct token investments is that regulated, exchange-listed proxies like Coinbase, Robinhood, and Strategy offer exposure to cryptocurrency without the custody risks that the hack brought to light. These stocks tend to recover once market sentiment stabilizes.

Not all observers share this optimistic outlook. Cristiano Ventricelli, vice president of digital assets at Moody’s Ratings, commented that the incident “underscores the heightened cybersecurity risks associated with hot wallets” and “illustrates the risk concentration inherent in large, centralized intermediaries.” He cautioned that the broader implications will depend on “the ultimate losses, affected counterparties, asset recovery, and importantly, whether the incident leads to wider disruption or loss of confidence.”

Binance has allocated $6.34 billion to cover losses and assured users that their assets remain secure. The Secret Service and FBI have launched an investigation, and firms including TRM and Chainalysis have linked the hack to North Korea’s Trader Traitor group.