Months After $19 Billion Bitcoin Crash, Binance Still Under Scrutiny

Months after the Oct. 10 liquidation cascade, crypto markets have yet to fully recover, and traders remain divided over Binance’s role as Bitcoin continues to slide.

The $19 billion wipeout initially appeared like a routine chain of forced liquidations across major exchanges as BTC fell to about $79,254.20. But its sheer size—the largest single-day liquidation in crypto history—and the lack of transparency have left traders frustrated and 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, and social media frequently attributes the crash to the exchange’s scale, derivatives dominance, or opaque operations.

Binance denies responsibility, citing market factors such as macroeconomic pressure, high leverage, illiquidity, and Ethereum network congestion. Co-founder Changpeng “CZ” Zhao described claims that Binance caused the crash as “far-fetched,” noting the company compensated affected users with roughly $283 million.

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 the event’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 markets remain leverage-heavy, liquidity is conditional, and volatility spikes when market makers retreat.

The lack of transparency fuels speculation. Former CFTC regulator Salman Banaei suggested a formal investigation, noting the absence of post-mortems leaves room for rumors. Traders continue to debate whether a single exchange was to blame.

For many, Oct. 10 is less about Binance and more about market structure. As former options trader Eric Crown put it: “High leverage, low liquidity, and risky altcoins created a perfect storm—and that’s exactly what happened.”