Months After $19 Billion Bitcoin Crash, Binance Remains in the Spotlight
Months after the Oct. 10 $19 billion liquidation cascade, crypto markets have yet to recover fully, and traders remain divided over Binance’s role as Bitcoin continues its decline.
At first glance, the sell-off seemed like a standard chain of forced liquidations as BTC fell to around $79,254.20. But the event’s unprecedented scale—the largest single-day liquidation in crypto history—and the lack of transparency have shaken market confidence.
Binance, the world’s largest exchange, has become a focal point. Bitcoin dropped as much as 12.5% that day, forcing leveraged positions to close. Social media frequently points to Binance, citing its size, derivatives dominance, and opaque operations.
Binance denies any fault, attributing the crash to market conditions: macroeconomic pressure, high leverage, illiquidity, and Ethereum network congestion. Co-founder Changpeng “CZ” Zhao called claims the exchange caused the crash “far-fetched” and noted that roughly $283 million was paid to affected users.
Critics remain unconvinced. Ark Invest CEO Cathie Wood blamed a “Binance software glitch” for $28 billion in deleveraging, while competitors like OXK and Hyperliquid highlighted Oct. 10’s lasting impact on market confidence and liquidity.
Others argue Binance is a convenient scapegoat. Wintermute CEO Evgeny Gaevoy described the crash as a flash event driven by high leverage in thin markets, not an exchange-specific failure. The broader problem is structural: crypto remains leverage-heavy, liquidity is conditional, and volatility spikes when market makers retreat.
The transparency gap fuels speculation. Former CFTC regulator Salman Banaei suggested a formal investigation, noting the absence of post-mortems leaves room for rumors.
Ultimately, Oct. 10 serves as a warning about crypto market structure. Eric Crown, former options trader, summarized: “High leverage, low liquidity, and risky altcoins created a perfect storm—and that’s exactly what happened.”
