Bitcoin News Today: Binance's $19B Crash Exposes Crypto's Systemic Weaknesses

The global cryptocurrency market experienced a historic liquidation event on October 10, 2025, as Binance users reported surging sell orders and deposit activity amid a $19 billion collapse in leveraged positions. The selloff, the largest single-day deleveraging on record, was fueled by a combination of geopolitical tensions and technical flaws on the world's largest crypto exchange.

Binance faced intense scrutiny after users claimed frozen accounts, failed stop-loss orders, and flash crashes caused by system delays during the liquidation wave. Altcoins such as Enjin (ENJ) and Cosmos (ATOM) briefly plummeted to near-zero prices on the platform before rebounding, while Bitcoin fell nearly 10% to below $110,000 in a 24-hour period. The exchange attributed the disruptions to "heavy market activity" but acknowledged that internal pricing mechanisms-reliant on non-independent oracles-allowed a $90 million stablecoin dump to trigger $1 billion in forced liquidations Binance Faces Intense Backlash Over The Market Crash – And Some Claims Are Shocking^[1].

The crash coincided with President Donald Trump's announcement of 100% tariffs on China, though data indicated the sell-off began hours earlier. A large trader exploited Binance's internal pricing system to short bitcoin and ether on Hyperliquid, netting an estimated $192 million profit as automated bots amplified the downturn. Binance's liquidity thinning and order-book freezes further exacerbated losses, with traders unable to execute stop orders or hedge positions Crypto’s Black Friday: Inside The $19 Billion Market Meltdown^[3].

In response, Binance announced a $400 million compensation package under its "Together Initiative," including $300 million in stablecoin payouts to affected users and $100 million in low-interest loans for institutions. The exchange also accelerated its transition to oracle-based pricing to prevent future exploits. However, critics argued the measures did not address systemic risks, including opaque infrastructure and lack of circuit breakers, which allowed a single exchange's mispricing to cascade into a global market meltdown Binance Increases Compensation for Customers Liquidated in …^[2].

Post-crash data showed a sharp deleveraging across crypto derivatives, with funding rates hitting multi-year lows and open interest collapsing by $65 billion. While Bitcoin stabilized near $115,000, altcoins faced deeper declines, with XRP, SOL, and BNB losing 30–60%. Analysts noted that the event exposed crypto's vulnerability to concentrated leverage and interconnected exchanges, though the rapid rebound suggested market resilience.

The episode intensified calls for regulatory scrutiny of centralized exchanges, particularly Binance's internal controls. Meanwhile, ETF flows turned negative on October 10, with BlackRock's IBIT experiencing its first outflows in weeks, signaling a shift in retail sentiment. Despite the turmoil, some market watchers viewed the liquidation as a "cleansing" of speculative excess, potentially paving the way for a more stable market structure Weekend 'Crypto Black Friday' liquidation cascade: What actually …^[4].