Reasons Behind the Bitcoin Crash and Binance Allegations

Since the collapse on October 10th, liquidity in the major cryptocurrency markets has remained weak and fragmented. The widening spreads and weak order books are being cited as reasons for Bitcoin's decline from approximately $125,000.

Binance has denied claims from some market participants that an internal error led to the collapse. However, critics argue that the exchange's limited explanations fuel distrust and lead to conspiracy theories.

Market makers and industry leaders have indicated that the events of that day revealed structural weaknesses in the depth of the cryptocurrency market and an over-reliance on leverage. This situation suggests that the problem is not limited to a single exchange and calls for a regulatory-style scrutiny.