Old Case Resurfaces: The 1011 Crash Sparks a Mixed Battle of Public Opinion Between Exchanges and Ecosystems
A wave of criticism targeting Binance resurfaced on social media, reignited by ARK Invest CEO Cathie Wood's comments blaming a past "system glitch" at the exchange for the crypto market's prolonged stagnation. She referred to the October 11th ("1011") event, a major market crash that saw over $190B in liquidations, as a key reason crypto wasn't rallying with other assets.
Binance co-founder He Yi quickly countered, suggesting Wood, a Coinbase investor, was not a user and misinformed. The 1011 event itself was a "black swan" where a sharp market downturn was exacerbated by a liquidity anomaly on Binance, triggering its Auto-Deleveraging (ADL) mechanism and causing massive, cascading liquidations. Binance later paid $283M in compensation but maintained the sell-off was market-driven.
The criticism evolved into a broader industry debate. Key figures leading the charge included Leonidas, a Bitcoin Ordinals proponent, who accused Binance of extracting value from the ecosystem via high token listing fees. OKX founder Star (Xu Mingxing) presented a more technical critique, arguing Binance's high-yield USDe promotion allowed systemic risk to accumulate, fundamentally altering the market's microstructure post-1011. Solana co-founder Anatoly Yakovenko indirectly supported critics, leading CZ to unfollow him—highlighting underlying competition between the BSC and Solana ecosystems.
In Binance's defense, some analysts like Dragonfly's Haseeb Qureshi argued the crash lacked a single cause, citing pre-existing market stress from Trump's tariff comments, API issues affecting market makers, and a lack of circuit breakers. Amid the FUD, Binance announced it would convert its $1B SAFU insurance fund from stablecoins to Bitcoin.
The incident underscores the immense scrutiny Binance faces as the industry's largest exchange, raising questions about its role in maintaining systemic stability in a leveraged and narrative-driven market.
Odaily星球日报02/02 03:12