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Binance pledges case-by-case compensation after volatility
Binance announced it will compensate certain users who lost funds during intense market volatility on Friday night, which caused degraded platform performance and a series of sharp token depegs. Senior executives including CEO Richard Teng and co-founder and chief customer support officer Yi He apologized publicly and urged affected customers to contact support for individual case reviews.
Which markets and tokens are under review?
Binance said it is focusing on three tokens that experienced dramatic depegs: Ethena’s stablecoin USDe, Binance-issued Solana liquid staking token BNSOL, and Wrapped Beacon liquid staking token WBETH. USDe, which aims to maintain a $1 peg, fell below $0.66 during the event. The exchange has identified the depeg window as between 2025-10-10 21:36 and 22:16 (UTC).
Eligibility and compensation mechanics
According to Binance’s follow-up announcement, compensation will apply to Futures, Margin, and Loan users who held USDe, BNSOL, or WBETH as collateral and were impacted by the depeg during the specified timeframe. The calculation will reimburse the difference between the market price at 2025-10-11 00:00 (UTC) and each user’s liquidation price. Binance emphasized the distinction that losses caused by ordinary market fluctuations or unrealized profits are not eligible for compensation.
Executives respond: apology and next steps
Yi He posted on X (formerly Twitter) acknowledging system strain triggered by the market moves and a surge in user activity. "If you have incurred losses attributable to Binance, please contact our customer service to register your case," she wrote, adding that each account will be reviewed individually. "When we fall short, we take responsibility—there are no excuses or justifications," He said.
CEO Richard Teng also apologized on X: "I’m truly sorry to everyone who was impacted. We don’t make excuses — we listen closely, learn from what happened, and are committed to doing better." Binance later clarified that users who bought depegged assets at low prices legitimately will not have those positions reclaimed. Wealth management users affected by packaged assets will be handled gradually, Binance said.
Market impact: liquidations and BNB price drop
The episode unfolded amid one of the largest liquidation events in crypto history. Over the past 24 hours more than 1.6 million traders were liquidated, erasing nearly $20 billion in open interest, according to Coinglass. Binance alone recorded roughly $1.4 billion in long liquidations and $981.6 million in short liquidations during this period. Notably, Binance’s liquidation mix showed around 59% of liquidations as long positions—much lower than most exchanges, where long liquidations often exceed 85%.
The native token BNB fell roughly 9–10% in the 24-hour period as market stress spread across crypto assets. BNB recently moved ahead of XRP to become the third-largest non-stable cryptocurrency by market capitalization, amplifying attention on price moves affecting the Binance ecosystem.
Industry reaction and calls for oversight
The scale of the liquidations prompted industry leaders and competitors to urge regulatory scrutiny. Crypto.com CEO Kris Marszalek posted on X calling for regulators to investigate exchanges with the highest volumes of liquidations and to review market practices for fairness. "$20B in liquidations, a lot of users got hurt. The job of regulatory bodies is to protect consumers and assure market integrity," he wrote.
What affected users should do now
Affected traders should immediately: contact Binance customer support to register a compensation claim; keep timestamps, trade IDs, and screenshots showing balances and liquidation events; and review collateral positions involving USDe, BNSOL, and WBETH. Because Binance will process claims individually, thorough documentation will help accelerate reviews.
Context and takeaway for crypto traders
This event highlights perennial risks in cryptocurrency markets: counterparty and platform performance, collateralized trading, and algorithmic or design risks in tokenized products such as liquid staking derivatives and algorithmic stablecoins. Traders and investors should prioritize risk management measures including position sizing, diversified collateral, and awareness of how exchanges handle oracle feeds, liquidity stress, and automated liquidations.
Binance’s promise to compensate impacted customers for specific collateral-related losses is a notable development for exchange accountability. Still, the broader market shakeout underscores the need for traders to exercise caution around exotic or recently launched products, and for regulators to consider whether additional safeguards are needed to protect market integrity and retail participants.
For now, Binance users affected during the depeg window should follow the exchange’s instructions to register cases with customer support and retain all relevant trade records while the company completes its case-by-case reviews.
Source: theblock
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