Binance Defends Its Role in October 10 Market Crash

At the February 12, 2026 session of Consensus Hong Kong 2026, Binance Co-CEO Richard Teng directly addressed the October 10, 2025 “10/10” market collapse, framing the event as a macro-driven liquidation cascade rather than a platform-specific breakdown.

The crash triggered approximately $19.3 billion in crypto liquidations, making it one of the largest single-day unwind events in the sector’s history.

Teng’s remarks focused on separating macroeconomic causation from exchange-level operational stress.

Macro Shock Versus Platform Failure

According to Teng, the primary trigger for the October 10 collapse was geopolitical escalation, specifically a reported 100% U.S. tariff threat on Chinese goods followed by China’s export restrictions on rare-earth metals. He argued that the shock rippled across global risk assets, emphasizing that while crypto markets saw $19 billion in liquidations, U.S. equity markets reportedly lost $1.5 trillion in value on the same day.

The positioning of the event as a cross-asset risk-off reaction forms the backbone of Binance’s defense: the exchange contends it was operating within a broader macro stress environment rather than initiating systemic failure.

USDe Depeg and Liquidation Timeline

A central controversy surrounding the crash involved the temporary depeg of the stablecoin USDe, which fell to $0.65 on Binance during peak volatility. Teng stated that approximately 75% of total liquidations had already occurred before the USDe deviation, arguing that the depeg and reported asset transfer delays were secondary effects rather than root causes.

He described those issues as isolated technical incidents occurring amid extreme market conditions, maintaining they were not structurally responsible for the broader unwind.

Compensation and Operational Accountability

While denying that Binance caused the crash, Teng acknowledged operational disruptions during the volatility spike. The exchange reportedly allocated between $300 million and $600 million in support and goodwill payments to affected users.

This distinction, macro causation versus technical responsibility, forms a key part of Binance’s messaging strategy. The firm accepts responsibility for system “hiccups” but rejects the narrative that its infrastructure triggered the $19 billion cascade.

Industry Skepticism and Leverage Debate

Not all industry participants have accepted Binance’s framing. Star Xu publicly questioned whether Binance’s marketing around high-leverage exposure tied to USDe may have contributed to systemic amplification effects. Critics argue that leverage structures can create feedback loops that intensify liquidation cascades once volatility accelerates.

Additionally, some traders reported API performance issues during peak stress, claiming they were unable to manage positions effectively. While Binance has not conceded systemic fault, the operational strain during the event remains a point of debate within trading communities.

Structural Implications

The 10/10 crash underscores the growing interconnectedness of crypto markets with global macroeconomic shocks. Whether viewed as a geopolitical risk-off event or a leverage-amplified breakdown, the episode highlights how liquidity fragmentation, derivatives exposure, and infrastructure resilience intersect during extreme volatility.

Binance’s defense at Consensus Hong Kong clarifies its official stance: macro forces triggered the collapse, while technical disruptions were secondary. The longer-term question for the industry is whether leverage concentration and stablecoin-linked derivatives structures introduce structural fragility during future cross-market stress events.

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