Cryptocurrency exchange Binance published a detailed blog post on Jan. 30, directly countering accusations that its platform glitch triggered the October flash crash. "On October 10, 2025, the crypto market faced a macro shock. While some placed the blame on a Binance glitch, the reality was that cascading liquidations were driven by macro risks from highly leveraged positions, market makers' risk controls limiting liquidity, and Ethereum network congestion delaying transfers," the post states.
Macro Shock Meets $100 Billion Leverage
Trade-war headlines sparked a synchronized global risk-off move after months of rising asset prices and expanding leverage across crypto derivatives. Bitcoin futures and options open interest exceeded $100 billion, leaving markets vulnerable to forced deleveraging once prices began to fall. As volatility surged, market makers' automated risk controls sharply reduced exposure, pulling liquidity from order books and amplifying price moves. Binance stresses that the impact wasn't confined to crypto: U.S. equity markets shed roughly $1.5 trillion that day, with the S&P 500 and Nasdaq enduring their largest single-day drops in six months and $150 billion in systemic liquidations.
Three-Token Depeg Not the Trigger
Countering the widespread narrative that USDe, BNSOL and WBETH depegged on Binance first and caused the crash, the exchange provides a timeline: between 21:10–21:20 UTC, roughly 75% of the day's liquidations had already taken place before the widely-reported three-token depeg occurred at 21:36 UTC. On Binance, USDe crashed to $0.65 while remaining stable at $0.99 elsewhere. Binance says the phantom depeg happened because the pricing engine used its own internal spot books, which had thinned out, rather than global market aggregates. This revalued collateral for Unified Account users at artificial price points, triggering a secondary wave of liquidations — but the initial macro-driven liquidations were already complete.
Admitted Strain, Denied Causation
Binance acknowledges that parts of its platform experienced temporary strain under extreme conditions: a brief slowdown in an internal asset-transfer subsystem and short-lived index deviations during severely thinned liquidity. It has since implemented infrastructure upgrades, tightened index methodology, and fully compensated affected users exceeding $328 million. The exchange also points to additional goodwill and lending initiatives as evidence of a proactive, user-focused response. The bottom line, according to Binance: "Importantly, Binance's platform-specific issues did not cause the flash crash."