"No Accident" – OKX Founder Blames Binance for October's Crypto Crash

Star Xu, the founder of the cryptocurrency exchange OKX, has accused Binance [BNB] of being responsible for the market crash that occurred on October 10th. In a post on X (formerly Twitter), Xu stated, “No complexity. No accident. 10/10 was caused by irresponsible marketing campaigns by certain companies.”

Key Takeaways

Star Xu from OKX blames Binance for the October 10 crypto market crash.
Binance attributes the crash to macroeconomic factors, specifically updates on tariffs from Donald Trump.
Despite recent price declines, BNB's market dominance has remained stable.
An independent review of the crash has yet to take place, leaving questions unanswered regarding its causes.

This article highlights the ongoing debates in the cryptocurrency space, particularly surrounding responsibility and market dynamics amid recent events.

OKX Binance

OKX Binance

Source: X/Star Xu

He further emphasized that the market dynamics have shifted since the crash. Importantly, Bitcoin has not managed to reestablish a positive correlation with traditional markets like the S&P 500 or Nasdaq, nor has it been able to match their gains. Xu highlighted the issue regarding Ethena’s USDe, which lost its peg on Binance. He criticized the exchange for offering an annual percentage yield (APY) exceeding 12% on this product, supported by leverage but lacking essential risk mitigation strategies. He urged Binance, as a leading player in the industry, to openly discuss “systematic risk” instead of viewing such conversations as criticisms. Xu concluded by stating, “Crypto is still early. What we choose to normalize today will determine whether this industry earns lasting trust—or repeats the same mistakes again.”

Binance Responds to the Allegations

Binance, the largest cryptocurrency exchange globally, has rebuffed claims that it triggered the crash. The exchange asserted that the market downturn was primarily due to macroeconomic shocks, notably updates on tariffs from Donald Trump, which led to a significant liquidation cascade totaling $19 billion.

While Binance admitted to experiencing technical complications during the crash, it asserted that it was not the main cause of the event. According to AMBCrypto, the first technical issue transpired from 21:18 to 21:51 UTC on October 10, causing temporary disruption in the asset transfer system due to overload. The second incident saw the USDe, BNSOL, and WBETH depeg between 21:26 UTC and 22:15 UTC.

Zach Rynes from Chainlink noted that the USDe’s depeg occurred after the liquidation events, implying Binance's minor role in the flash crash.

Binance

Source: X/Zach Rynes

To date, an independent examination of the crash has not been conducted, leaving a gap in understanding the circumstances and avoiding future occurrences.

Impact on BNB: Is It Unaffected?

Despite the fresh fears surrounding Binance, the BNB token has taken a hit this week, dropping 8% in price. Last week saw a similar decline. As of now, the BNB price has dipped below $900. Interestingly, BNB's market share remained stable and even increased by 4% during this period. This indicates that BNB was not aggressively sold compared to other altcoins, despite the ongoing FUD (fear, uncertainty, and doubt) and a general sense of weak market sentiment.

Binance BNB

Source: BNB price vs market share, TradingView

Conclusion