Binance has issued a detailed report addressing last week’s historic wave of volatility that briefly sent shockwaves across the cryptocurrency market.
The world’s largest exchange confirmed that despite intense sell-offs triggered by global macroeconomic events, its trading systems remained largely stable, with only brief technical issues recorded in specific modules.
The statement, released late Sunday, clarified that between 20:50 and 22:00 UTC on October 10, a cascade of institutional and retail sell orders caused widespread liquidations across the crypto sector. Binance noted that the forced liquidations processed on its platform represented only a small fraction of the total market activity, emphasizing that the downturn was driven by overall market dynamics rather than exchange-related factors.
Technical Glitches and Swift User Compensation
Following the sharp market decline, Binance acknowledged that some internal systems experienced short-lived technical disruptions around 21:18 UTC, alongside de-pegging events affecting several assets tied to its Earn products. Within 24 hours, the exchange confirmed it had compensated affected users in full – totaling roughly $283 million distributed in two rounds.
Among the affected assets were USDE, BNSOL, and WBETH, all of which saw temporary price dislocations during the chaos. Binance clarified that the de-pegging occurred after the major sell-off, not before, countering online claims that the Earn products had triggered the broader crash.
Additionally, Binance said it would reimburse users impacted by delays in internal fund transfers and redemption requests during the event, particularly those who faced margin challenges due to system lags.
Addressing Abnormal Spot Market Movements
The exchange also investigated a series of sudden and extreme price dips in specific spot trading pairs – some briefly showing “zero price” readings. Binance attributed these anomalies to a combination of old limit orders dating back several years and temporary liquidity gaps during the sell-off.
For instance, tokens such as IOTX and ATOM were affected when dormant limit orders were triggered under one-sided trading conditions. Binance explained that its mark-price mechanism on Futures markets automatically filters such outlier data to prevent unfair liquidations, ensuring traders were not penalized by these momentary distortions.
The company added that some zero-value prices were purely a visual bug following a recent adjustment to the decimal precision of certain pairs. The issue, it said, was limited to the interface and did not reflect actual trade execution at zero.
Enhancing Transparency and Risk Controls
Binance pledged to improve its user interface and apply fixes to prevent similar display irregularities, while continuing to monitor all ongoing compensation cases. The platform reaffirmed its “user-first” policy, promising ongoing transparency and updates as reviews progress.
In its closing remarks, the company reiterated that extreme volatility is an inherent feature of the digital asset market and urged investors to exercise responsible trading and risk management practices. Binance also noted that any suspicious trading activity uncovered in its investigation will be reported to regulators as required.
Despite the turbulence, Binance’s handling of the event – including rapid compensation and transparent reporting – may help reinforce user confidence in the platform’s stability under pressure.
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