A market maker's public accusation against Binance disappeared from social media this week after the exchange provided technical logs that contradicted claims of widespread trading failures during the Oct. 10 market crash, raising questions about platform accountability and the transparency of cryptocurrency exchanges during periods of extreme volatility.
What to Know:
- Market maker GammaPure deleted posts accusing Binance of failing to execute automated orders during the October crash after the exchange shared technical data showing no system errors for reduce-only orders.
- The deletion sparked speculation about pressure tactics or financial settlements, though the trader said he received only standard compensation through Binance's $400 million recovery initiative.
- Multiple exchanges experienced outages during the market downturn triggered by tariff announcements, with users reporting frozen accounts and halted stop-loss orders across platforms.
Exchange Faces Scrutiny After Market Crash
The crypto market suffered significant losses on Oct. 10 following tariff escalation announcements. Binance users reported frozen accounts, halted stop-loss orders and other platform malfunctions during the downturn. The exchange attributed the disruptions to intense trading activity, a claim that failed to satisfy many traders who believed the platform profited from the chaos.
Coinbase and Robinhood also experienced outages during the same period.
Binance announced a $400 million recovery initiative on Oct. 14 in response to the backlash from users.
Trader GammaPure posted claims earlier this week that he and other market makers lost millions when Binance failed to execute automated orders during the crash. He said he had evidence to support the allegations. The post gained traction before its sudden removal.
Technical Data Contradicts Initial Claims
GammaPure addressed the deletion in a subsequent post, explaining that Binance's technical team provided complete logs during a formal meeting. The logs showed that reduce-only orders never encountered the 503 errors he had initially reported. An investment firm connected to the trader joined the investigation and reviewed global logs, confirming the absence of system errors for those specific order types.
"Yesterday, I created a group chat with some colleagues from Binance, marking the first time they had a full and formal conversation with me," GammaPure wrote. "My main argument was that 'API orders failed, and reduce-only orders returned a 503 error.' But Binance's technical team provided complete logs during our meeting, which showed that the reduce-only orders never encountered a 503 error."
The deletion fueled speculation across the industry. Some observers suggested Binance applied pressure to remove the criticism. Others suspected a private financial arrangement motivated the takedown.
One analyst questioned on social media whether backroom deals influenced the removal.
Another user suggested the exchange was silencing critics through undisclosed means.
GammaPure rejected claims that Binance paid him to delete the posts. He said he received compensation only through the exchange's "Together Initiative," which provided standard one-time payments to users who met specific criteria and had not filed formal claims. Cases involving formal complaints undergo individual review to determine platform responsibility before compensation decisions.
The trader said he chose to step back because he could no longer verify which information was accurate. He did not want to spread misinformation. The incident highlights ongoing concerns about exchange reliability during market stress and the difficulty users face when challenging major platforms.
Understanding Key Terms
API orders are automated trading instructions sent through application programming interfaces, allowing traders to execute strategies without manual intervention. Reduce-only orders are designed to close existing positions without opening new ones, serving as a risk management tool during volatile periods. A 503 error indicates a server is temporarily unable to handle requests, typically due to overload or maintenance.
Market makers provide liquidity by placing both buy and sell orders, profiting from the spread between bid and ask prices. During extreme volatility, they face heightened risk when exchanges fail to execute orders as expected.
Closing Thoughts
The controversy underscores tensions between cryptocurrency exchanges and professional traders during market disruptions. While Binance provided technical evidence contradicting the initial accusations, the episode raises broader questions about platform transparency and the mechanisms available to users seeking accountability from exchanges during periods of extreme market stress.