Step Finance Hit by $29M Hack as Bitcoin Slumps to 9-Month Low Amid Geopolitical Tensions
The Solana-based DeFi platform Step Finance was hit by a $29 million security breach on January 31, 2026, causing its native token (STEP) to plummet by more than 80%. This incident occurred during a significant broader market downturn, with Bitcoin (BTC) falling toward $78,000 and Ethereum (ETH) dropping more than 7%.
Step Finance Security Breach
On January 31, 2026, Step Finance reported a compromise of several treasury and fee wallets.
Assets Stolen: Approximately 261,854 SOL, valued at roughly $29 million at the time of the incident.
Impact: The protocol's Total Value Locked (TVL) dropped to zero on major trackers, and the STEP token price cratered from approximately $2.65 to $0.42.
Nature of Attack: Initial investigations suggest a targeted compromise of treasury wallets rather than a smart contract exploit; user funds were reportedly not directly affected.
Broader Market Plunge
The hack coincided with a sharp "liquidation shock" across the cryptocurrency market.
Market Drivers: Analysts attribute the plunge to escalating geopolitical tensions (specifically U.S.-Iran tensions) and fears regarding massive AI infrastructure spending by Big Tech.
Liquidations: Over $850 million in bullish bets were liquidated on January 31 as BTC, ETH, and SOL all saw deep daily losses.
Price Levels: Bitcoin slipped below $81,000 in thin weekend trading, marking its lowest levels so far in 2026.
Key Insights
Institutional Selling: Long-term holders have reportedly divested approximately 143,000 BTC (worth $9.5 billion) over the last 30 days, increasing downward pressure.
Security Context: This event follows a massive $282 million social engineering theft from a private hardware wallet earlier in January 2026, underscoring a high-risk environment for digital assets this year.
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