Binance experienced the worst liquidation day in cryptocurrency history.

Binance Experienced a Crash Due to Market Risk Factors

Binance attributed the sudden crash on October 10 to a clash between macroeconomic sell-offs, heavy leverage, and declining liquidity. The exchange rejected claims of a fundamental trading system error.

It was noted that, due to various factors, positions opened in Bitcoin derivatives exceeded $100 billion, leading to chain liquidations due to the rapid frequency of examined order books. Additionally, blockchain congestion and rising Ethereum gas fees further exacerbated the fragmentation between trading venues.

Binance acknowledged a platform-specific issue and announced that it would compensate users over $328 million. It was emphasized that approximately 75% of the liquidations occurred before the exchange index deviations, indicating that a broader market shake-up was the primary cause.