A cryptocurrency token dating back to 2017 suffered a collapse of more than 90% on Friday after the hacker behind the Binance security breach began selling large amounts of the asset into a market with limited liquidity.
FUNToken (FUN), previously called FunFair, plunged on Uniswap after the attacker offloaded millions of tokens into its FUN/WETH liquidity pool. GeckoTerminal data shows the token’s price fell from roughly 0.0000037 wrapped ether (WETH) to 0.00000017 WETH.
The decline was also reflected across the broader market. FUN lost approximately 68% of its value over 24 hours, according to CoinGecko data.
Uniswap operates through liquidity pools that allow users to exchange tokens directly, without relying on a centralized exchange’s traditional order book. This structure can make smaller assets particularly vulnerable when large holders attempt to sell significant amounts at once.
FUN originated during the 2017 cryptocurrency boom, when its developer, FunFair Technologies, raised $26 million in a four-hour token sale in July. The funds were intended to support the development of blockchain-based online casino games. The project now operates under the FUNToken name.
The selling pressure came from the attacker associated with Binance’s security breach, which involved more than $6 billion in assets taken from the exchange’s internet-connected hot wallets. The incident is considered the largest cryptocurrency theft on record.
Arkham Intelligence identified major assets among the stolen holdings, including USDT, USDC, Bitcoin, Ether, TRON and Solana. The wallet also contained smaller cryptocurrencies such as FUN, PROM, RSR, RED, OGN and GTC, according to Joshua Frank, co-founder and CEO of The Tie.
Tether and Circle responded by freezing stolen tokens under their control, while other stablecoin issuers took similar measures. FUNToken also requested that centralized exchanges temporarily block FUN deposits to limit potential exposure.
Decentralized exchanges, however, could not be shut down in the same way. The attacker continued using platforms such as Uniswap to convert the stolen tokens.
Hacker Sells More Than 134 Million FUN
Etherscan records show that a wallet labeled “Binance Hot Wallet Exploiter 2” transferred 714.9 million FUN to a newly created address, 0x06ea…685f, at 23:28 UTC on Thursday.
The new wallet began selling tokens into Uniswap’s FUN/WETH pool three minutes after receiving the funds.
More than 150 transactions followed over the next several hours. Nearly all were executed through Uniswap v2, with one sale routed through PancakeSwap. The final transaction was recorded at 04:17 UTC on Friday.
In total, the wallet exchanged 134.1 million FUN for 111.5 ETH, worth approximately $250,000, according to Etherscan.
Frank had previously valued the hacker’s FUN holdings at $6.23 million. Using that estimate, the tokens sold were worth approximately $1.17 million before liquidation. The attacker therefore recovered only around 21% of their estimated market value.
Small Uniswap Pool Leaves FUN Exposed to Heavy Selling
The token’s limited liquidity made the selloff particularly damaging. At the time of reporting, the FUN/WETH pool held only about $16,000 in combined assets, split evenly between the two tokens.
In an automated market maker such as Uniswap, prices adjust according to the changing balance of assets inside a pool. Selling FUN adds more tokens to the pool while removing WETH. When liquidity is low, a large transaction can significantly alter that balance and cause a sharp price decline.
Joshua Frank had previously warned that the attacker’s holdings could overwhelm smaller token markets. In an analysis shared on X, he compared the value of the stolen tokens with their respective daily trading volumes.
FUN topped the list, with the attacker’s holdings valued at $6.23 million, or 252% of its reported daily trading volume. PROM was also among the tokens facing substantial exposure.
“The hacker holds more than an entire day’s reported trading volume in FUN and PROM,” Frank wrote.
He noted that daily trading volume offers only an approximate measure of a market’s capacity to absorb large transactions.
FUN Recovers 75% as Remaining Hacker Holdings Raise Risk
FUN began recovering after the attacker stopped selling, with the price in its Uniswap pool rising 75% over the past hour.
Despite the rebound, the selling wallet still contains 580.8 million FUN, equivalent to approximately 5.4% of the token’s maximum supply, according to Etherscan. Any further liquidation could put renewed pressure on the market.
Other smaller tokens held by the attacker also recorded losses. Reserve Rights (RSR) declined 17.6% over 24 hours, while RedStone (RED) dropped 17.1% and Gitcoin (GTC) fell 16.6%.
Origin Protocol (OGN), yearn.finance (YFI) and 1inch (1INCH) registered losses ranging from 9% to 13.6%, according to CoinGecko. Bitcoin and Ether posted comparatively smaller declines of 1.8% and 2.9%.
Etherscan data indicates that the attacker’s main wallet, 0x5227…2f8c, sold these assets through dozens of transactions on Uniswap and PancakeSwap.
Frank highlighted FUN, PROM, RSR, RED, OGN, SOPH, ERA and GTC as the main tokens to watch. He said the bigger concern is how much of the stolen supply remains transferable, how quickly it could reach the market and whether available liquidity can handle additional selling.
