Changpeng Zhao claims that Binance triggered the October 10, 2025 cryptocurrency market crash during an ask-me-anything session on Binance's social platform Friday.
The former CEO called accusations "far-fetched," adding that users blaming the exchange for the $19 billion liquidation event are "unlikely to be successful in the future."
Zhao's defense arrived three months after the largest single-day liquidation in cryptocurrency history. Bitcoin (BTC) fell below $110,000 on October 10 as technical glitches on Binance caused wrapped tokens like wBETH to drop as much as 90%, triggering erroneous margin calls and frozen withdrawals.
The timing coincided with President Trump announcing 100% tariffs on Chinese imports, which accelerated broader market panic. Binance announced compensation packages totaling approximately $683 million through an initial $283 million payout plus the "Together Initiative" providing $300 million in stablecoins and $100 million in low-interest loans.
What Happened
Binance experienced pricing failures when USDe, BNSOL, and wBETH depegged between 21:36 and 22:16 UTC on October 10, with USDe falling to $0.65 on Binance while maintaining near $1.00 on other exchanges.
The exchange's Unified Account system valued collateral using internal order book data rather than external oracles, creating vulnerability to manipulation.
Zhao maintained that Binance operates under U.S. government monitorship and regulatory oversight in Abu Dhabi, where authorities have full access to operational data. He stepped down as CEO in November 2023 after pleading guilty to failing to maintain an effective anti-money laundering program as part of a $4.3 billion settlement with U.S. authorities.
The former executive received a presidential pardon from Trump in October 2025, drawing criticism from Democratic lawmakers questioning Binance's political connections. Zhao denied having business relationships with the Trump family during a separate CNBC interview, stating "there's no business relationship whatsoever" and calling the narrative "misconstrued."
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Industry Pushback
OKX founder Star Xu criticized Binance's role in the crash, writing Wednesday that "people had underestimated the impact of the 10/10 incident" and describing it as causing "real and lasting damage to the industry." Xu suggested Binance facilitated volatility by supporting "profit takers, insider trading, and Ponzi crypto schemes."
Bitcoin trades near $82,800 at the time of writing, down approximately 25% from pre-crash levels above $120,000 on October 10. Zhao's recent social media post advocating "buy and hold" investment strategies drew community backlash, with critics arguing the advice ignored market reality where over 90% of 221 Binance Alpha-listed tokens trade far below post-listing highs.
Binance's native token BNB trades around $847, declining 38% from its October 2025 all-time high of $1,370. Total cryptocurrency market capitalization fell from over $4.1 trillion before the crash to approximately $3.2 trillion currently, representing a 20% decline that persists three months later.
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