CZ Denies Binance Caused October Crypto Flash Crash: Separating FUD from Facts

In the wake of crypto's brutal $19 billion liquidation event on October 10, 2025, fingers are pointing at Binance once again. Accusations of massive Bitcoin dumps and technical glitches have fueled a fresh wave of FUD. But Binance co-founder Changpeng Zhao (CZ) is pushing back hard, calling the claims 'far-fetched' and emphasizing external market forces. As scrutiny intensifies amid ongoing volatility, CZ's defense sheds light on what really happened—and what it means for the industry.

The October 10 flash crash remains one of crypto's darkest days. Bitcoin plunged amid a cascade of leveraged positions wiped out, totaling a staggering $19B in liquidations. Critics quickly zeroed in on Binance, alleging the exchange triggered the chaos by dumping $1 billion in BTC or suffering system failures that exacerbated price discrepancies. CZ isn't buying it. In recent X posts, he dismissed the narrative outright: 'Binance did not cause the $19B crypto crash.' He pointed to preceding macroeconomic shocks, like tariff announcements, colliding with overleveraged positions and evaporating liquidity. 'The tariff announcements preceded the crash, not Binance system issues or Binance doing anything,' CZ clarified in an AMA on Binance Square. Binance echoed this, attributing the event to a 'macro liquidation spiral' rather than internal failures. Minor technical hiccups occurred, but users were fully compensated, including for a USDe price dip later deemed a glitch. As @cz_binance tweeted last week, 'FUD doesn't hurt the target... Binance [is] a large net hoarder' of assets, converting only portions of revenue for expenses under global regulatory oversight. Accusations persist, with some X users and analysts claiming Binance's dominance amplifies risks. Yet CZ counters that no one 'manipulates Bitcoin'—big players included. Binance's SAFU fund is even shifting $1B to BTC over 30 days, signaling confidence, not capitulation. Recent buys, like another $100M in Bitcoin, underscore this: 'Fudders FUD. Binance buys.' This isn't CZ's first rodeo. Post-FTX collapse, similar blame games targeted Binance. But with regulators now reviewing every trade, transparency is higher than ever. The real culprits? Leverage addiction and macro headwinds, not one exchange.

The blame game has ripple effects. Renewed FUD contributed to Bitcoin dipping below $80K recently, spooking retail while institutions loaded up. Exchange volumes shifted temporarily, but Binance retains dominance. Trust erosion could slow adoption, yet it highlights the need for better risk management. Post-crash, BTC stabilized around key supports, with prediction markets hitting records despite the turmoil—signaling resilience amid volatility.

CZ's firm denial refocuses the conversation: crypto crashes stem from systemic risks, not scapegoats. As markets mature with stricter oversight, expect fewer flash crashes and more accountability. Binance's net buying stance bodes well for bulls. Stay informed, ditch the FUD, and position for the next leg up—crypto's story is far from over.