OKX CEO Star Xu has publicly accused Binance of being central to the October 10 crypto market crash that wiped out tens of billions of dollars, causing damage that many described exceeded the fallout from the FTX collapse in 2022.
Star Xu: Binance USDe Marketing Responsible For October 10 CrashNotably, users were encouraged to convert USDT and USDC into USDe for yield. But market risk escalated when traders started using this USDe as collateral to borrow more USDT to convert it again into USDe, and repeat the cycle. This leverage loop resulted in outrageous APYs of 24%, 36%, and even over 70%, which many users perceived as low risk simply because they were offered on a major exchange such as Binance. However, a surge in market volatility would cause the USDe to depeg rapidly, triggering massive waves of liquidations. Xu said weak risk management around assets like WETH and BNSOL amplified the shock, resulting in some tokens briefly trading near zero. While insisting he was not assigning blame, Xu emphasized the need for industry leaders such as Binance to prioritize transparency, stronger risk controls, and responsible innovation, warning that short-term yield games undermine long-term trust.
CZ Fires BackCZ argued that given Bitcoin’s sheer market scale and liquidity, it would be extremely difficult for any single entity to influence prices simply by “dumping.” Binance’s internal post-incident review did reveal technical irregularities that occurred on the day, including temporary transfer or UI display issues and deviations in certain indices, but CZ denied that these played a causal role in the crash.
