Binance Accused of Stealing Rare Bitcoin Ordinal After User Accidentally Sends it to Wrong Address

A crypto user recently accused Binance of stealing a rare Bitcoin Ordinal after he mistakenly sent it to the wrong wallet address, sparking a viral storm

A crypto user's recent post on X, formerly Twitter, sparked a viral backlash against Binance after he accused the exchange of stealing a rare Bitcoin Ordinal that he had mistakenly sent to the wrong wallet address.

The user had been experimenting with Bitcoin Ordinals, a type of digital collectible similar to NFTs, and had made a picture-based Ordinal.

In a moment of misjudgment, he sent the collectible to his Binance bitcoin deposit address, despite the exchange clearly stating that only regular BTC should be sent for deposits.

After realizing his blunder, he contacted Binance support in a panic, hoping to salvage his lost asset. However, the exchange told him that the asset could not be recovered as customer deposits and withdrawals at the exchange are handled through a commingled fund.

This means that all customer deposits get mixed together into a big pool of bitcoin, and when someone requests a withdrawal, Binance sends out random satoshis from the pool.

The user was devastated and assumed that the Ordinal was gone forever. However, to his surprise, he later spotted the same collectible listed for sale on Magic Eden, a popular marketplace for digital assets.

The seller was a savvy collector who had been engaging in “sats panning”—a little-known crypto hobby where people search for rare satoshis, the smallest units of bitcoin.

Bitcoin Ordinals are tied to specific satoshis, and whoever owns those sats also owns the Ordinals embedded in them.

At large exchanges like Binance, all customer deposits get mixed together into a big pool of bitcoin, known as commingled funds.

When someone requests a withdrawal, Binance sends out random satoshis from the pool, without checking if they are special or rare.

The collector had withdrawn bitcoin from Binance and unknowingly received the sat that contained the lost Ordinal, like winning a digital lottery.

This practice, called sats panning, works like old-school gold panning. Users deposit and withdraw bitcoin repeatedly, hoping to stumble upon rare sats.

Sometimes, one of these rare finds gets listed on platforms like Magic Eden, just like what happened in this case.

The collector had bought the sat from another user who had gotten it during a regular withdrawal from Binance.

A vivid snapshot of the incident, shared by the user and later deleted, showed a private message from a crypto influencer who tried to intervene.

“There’s probably nothing they can do unfortunately. They are a criminal organization who steal from users and then post passive-aggressive messages about it on their blog,” the influencer said.

Another X user, who had lost some crypto to a rug pull scam earlier this year, also commented on the post, saying that he wished he had invested in Binance instead.

“At least they would have returned the lost crypto after a viral scandal,” the user said.

Several X users tagged Binance founder Changpeng Zhao in the post, hoping that he could intervene and help the user get back his lost Ordinal.

However, the story took an unexpected turn. The user deleted his post after realizing that he had made a mistake in accusing Binance of wrongdoing.

In a follow-up post, the user explained that he had become angry and frustrated after losing the Ordinal, but he had since learned about sats panning and understood how the lost collectible could be picked up by another user during a regular withdrawal.

He also said that he had contacted the seller on Magic Eden and they were aware that the lost Ordinal belonged to the user.

The seller had offered to return the collectible, but the user declined as he no longer had any interest in it after the whole incident.

“I'm not sure why they decided to sell it on Magic Eden but I guess they thought they could make some profit from it,” the user said.

Despite the amicable resolution, the incident had already sparked a huge discussion on social media, with many users criticizing Binance for its handling of customer assets and lack of transparency.

The post was widely shared and discussed on crypto forums and groups, generating a strong reaction from the online community.

Some users expressed disbelief at the exchange’s actions, while others said that it was common knowledge that exchange hot wallets are constantly being used and any deposited assets belong to the exchange until withdrawal is requested.

One user said that it was ironic how a crypto exchange, which is supposed to be built on open-chain technology, was handling a collectible like a traditional bank.

“They should be making it easier for people to transfer their assets across different platforms, not create obstacles and claim that it's impossible to identify the original sender of a crypto payment,” the user said.

Another user said that it was sad to see how a simple mistake could lead to such a complicated situation.

“I hope this will encourage more crypto platforms to be responsive and helpful to their users, especially when they encounter difficulties,” the user said.

Binanc e did not immediately respond to a request for comment.