Crypto Twitter is angry again. This time, the target is familiar: Binance, the world’s largest crypto exchange, and its co-founder Changpeng Zhao (CZ).
Over the past few days, major allegations have taken over Twitter (or X) timelines, with some users calling him “a scammer” and demanding he be “sent back to prison.” So what is actually behind the latest accusations, and how much of it is supported by verifiable evidence?
The October Market Crash: What Happened?
One of the most serious allegations facing Binance dates back to October, during what later became known as “Crypto Black Friday.”
On October 10, US President Donald Trump announced 100% tariffs and export controls targeting China. The announcement immediately rattled global markets, sending risk assets sharply lower.
Crypto was no exception. BeInCrypto reported that Bitcoin fell around 10%. Major altcoins followed suit: Ethereum (ETH), XRP (XRP), and BNB (BNB) each declined by more than 15%.
Within 24 hours, more than $19 billion in leveraged positions were liquidated, marking the largest liquidation event tracked by crypto data analytics firm CoinGlass.
Initially, the crash was widely viewed as a market-wide panic triggered by macroeconomic news. However, market participants soon began to question whether the collapse was purely organic.
Sponsored
Sponsored
On social media, traders speculated that the scale and speed of the liquidations suggested something more coordinated than a standard sell-off. Attention soon turned to Binance.
Why Binance Became the Focus
During the sharpest phase of the crash, Binance users reported frozen accounts and failed stop-loss orders, and difficulties accessing the platform. Some traders also pointed to brief flash crashes that pushed assets, such as Enjin (ENJ) and Cosmos (ATOM), to near zero.
BeInCrypto reported that three Binance-listed assets, including USDe, wBETH, and BNSOL, temporarily lost their pegs amid the turmoil.
Binance publicly acknowledged disruptions during the event. The exchange cited “heavy market activity” as the cause of system delays and display issues, while reiterating that user funds remained SAFU.
Still, the explanation failed to calm all critics. Some users accused Binance of benefiting from the trading freeze, alleging that the disruption allowed the exchange to profit during peak volatility.
Did Binance’s Compensation Strategy Work?
On October 12, Binance released a statement following an internal review of the incident. According to the exchange, core spot and futures matching engines, as well as API trading, remained operational.
“According to data, the forced liquidation volume processed by Binance platform accounted for a relatively low proportion to the total trading volume, indicating that this volatility was mainly driven by overall market conditions,” the exchange noted.
However, Binance acknowledged that certain platform modules experienced brief technical glitches after 21:18 UTC on October 10, and that some assets suffered de-pegging due to extreme market fluctuations.
Binance stated that it completed compensation for affected users within 24 hours, distributing approximately $283 million across two batches.
Two days later, on October 14, Binance launched a $400 million support initiative. The package included $300 million in reimbursement vouchers for eligible impacted traders, with the remaining funds allocated to low-interest institutional loans.
While Binance was at the center of community backlash, it was not the only platform affected amid the crash. Other major exchanges, including Coinbase and Robinhood, also reported service disruptions.
Coinbase’s Bitcoin trading activity also drew scrutiny, though no conclusive evidence has linked it to market manipulation or to triggering the crash.
It’s worth noting that scrutiny continued in the weeks following the crash; some earlier claims were later reassessed. One trader who had publicly accused Binance later retracted those claims.
After reviewing technical data provided by the exchange, the trader said Binance’s logs showed no system errors. He subsequently deleted the original post, stating he did not want to contribute to the spread of unverified information.
“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. An investment firm connected to my friend also joined the investigation. The main account management team and their responsible staff reviewed the global logs and confirmed that there was no 503 error for reduce-only orders,” the post read.
Why the Binance Backlash Resurfaced in January 2026
For a while, the dust seemed to settle. Then 2026 arrived, and the allegations came roaring back. This had a lot to do with how the crypto markets performed in the months following October.
Sponsored
Sponsored
After the massive deleveraging event, the market stayed under pressure. Bitcoin and Ethereum gave up all of their 2025 gains, closing the year in the red. Market experts increasingly pointed to the October crash as a key factor behind the sector’s muted performance.
“There was a massive deleveraging…some exchanges and market makers…so the industry is sort of limping along, but the fundamentals have improved a lot,” BitMine Chairman Tom Lee stated.
The discussion intensified further after Ark Invest CEO Cathie Wood’s recent comments. In a recent interview with Fox Business, she said:
“What we have undergone in the last 2-3 months are the reverberations after 10/10…October 10….is the flash crash associated with a software glitch on Binance that deleveraged the system, and to the tune of $28 billion, there were a lot of people hurt.”
Soon, other industry figures began to weigh in. Star Xu, founder of OKX, commented that people have “underestimated the impact of 10/10,” arguing that the crash caused “real and lasting damage” to the crypto industry.
An industry-leading company, he said, should prioritize core infrastructure, trust with users and regulators, and the long-term health of the ecosystem. Without mentioning specific firms, Xu contrasted that ideal with what he described as a growing focus on short-term gains.
“Instead, some chose to pursue short-term gains—repeatedly launching Ponzi-like schemes, amplifying a handful of “get-rich-quick” narratives, and directly or indirectly manipulating the prices of low-quality tokens, drawing millions of users into assets closely tied to them. This has become their shortcut for attracting traffic and user attention. Legitimate criticism is then drowned out—not through facts or accountability, but via aggressive narrative control and coordinated influencer campaigns,” the executive added.
Binance Faces Trader Accusations
Market watchers began circulating what they described as alleged evidence of Binance’s wrongdoing.
In a post on X (formerly Twitter), Star Platinum pointed to Binance’s October 6 announcement that it would update the pricing source for BNSOL and wBETH, with the update scheduled for October 14.
StarPlatinum further claims that more than $10 billion moved in the 24 to 48 hours before the event, including large USDT and USDC inflows into exchange hot wallets.
The analyst also highlighted USDe flows tied to wallets they label as Binance-linked. The analyst contrasted Binance’s situation with Coinbase’s, stating:
“Coinbase didn’t list the weak links (USDe / wBETH / BNSOL) but did two things: Moved 1,066 BTC from cold to hot minutes before the cascade ($130M at pre crash prices). During the drop, large flow that couldn’t fill on Coinbase appears to have been routed out via market makers (Prime-style diversion). Coinbase’s cbETH peg held; Binance’s wBETH collapsed.”
StarPlatinum also noted that major market-making firms such as Wintermute and Jump appeared to have limited activity in USDe, wBETH, and BNSOL during the period of extreme volatility.
Sponsored
Sponsored
“Pull bids in those books while Binance marks collateral off those books, and the liquidation engine eats itself,” the analyst remarked.
They also allege a new account built up to around $1.1 billion in notional BTC and ETH shorts in the final two hours before the crash, with one ETH position increasing roughly a minute before a key post, generating an estimated $160 million to $200 million in profit.
Another user accused Binance of manipulating liquidation timestamps. According to the user, Binance announced after the crash that it would compensate eligible liquidations occurring after 05:18 (UTC+8).
However, the trader says his liquidation was recorded on the platform at 05:17:06, placing it just outside the eligibility window.
The trader argues that this timestamp conflicts with an automated system email showing a liquidation trigger time of 05:20:08 (UTC+8), a difference of approximately three minutes.
“This auto-generated, tamper-proof email is the most ironclad evidence. This is the core of crypto: Code Is Law,” the post stated.
Meanwhile, Binance’s own statement cited a different timeframe:
“All Futures, Margin, and Loan users who held USDE, BNSOL, and WBETH as collateral and were impacted by the depeg between 2025-10-10 21:36 and 22:16 (UTC) will be compensated, together with any liquidation fees incurred,” the exchange mentioned.
Crypto Twitter Erupts With “Scammer” Claims Against CZ
As these claims circulated, it did not take long for the tone on social media to escalate. Users began sharing lengthy posts labeling CZ a “scammer” and accusing him and Binance of systematically abusing their market dominance to the detriment of competitors and retail traders.
Multiple posts gained traction, with several going viral as community members amplified the claims and expressed support. As engagement surged, the allegations became a recurring fixture on Crypto Twitter timelines.
In an interview with BeInCrypto, Ray Youssef, CEO of NoOnes, described Binance as a US-aligned instrument for what he called a “controlled demolition” of the crypto market.
Youssef suggested that Zhao has aligned himself with the US establishment, which he characterized as the real power now influencing Binance’s direction.
For Youssef, Binance’s growing ties to the United States are a cause for concern. He claimed the exchange has become a controlled asset that could ultimately be used to trigger or accelerate a broader market collapse.
“Binance is becoming is the next FTX or what FTX should have been…When CZ burst the bubble on FTX, the damage was really basically 1% of what the state planned it to be. Now they’re going to use Binance as that they’re going to make that corpse explode right in our face,” Youssef told BeInCrypto.
Sponsored
Sponsored
Criticism has also extended to Zhao’s recent comments on the buy-and-hold strategy.
“I’ve seen many different trading strategies over the years, very few can beat the simple ‘buy and hold’, which is what I do. Not financial advice,” CZ wrote.
The remarks drew swift backlash. Critics pointed to the performance of tokens listed on Binance, arguing that many have lost significant value and questioning whether a buy-and-hold approach is realistic for retail users.
“The biggest scam exchange to ever exit, all project should apply for a delisting from binance,” an analyst asserted.
However, BeInCrypto reporting shows that the weakness was not exchange-specific. Crypto tokens listed across major platforms in 2025 broadly struggled to sustain positive price performance.
The trend held regardless of the exchange, reflecting a market-wide downturn rather than issues tied to any single trading venue.
That’s not all. Users also accused Binance of selling Bitcoin today amid the market crash.
Binance and CZ Issue Response Amid Backlash on Crypto Twitter
Nonetheless, as the backlash grew louder, Binance moved to project strength. The exchange announced plans to convert the entire $1 billion reserve of its Secure Asset Fund for Users (SAFU) from stablecoins into Bitcoin over the next 30 days.
In an open letter to the community, Binance stressed that it “holds itself to elevated standards” and “continually improves based on feedback” from users and the broader public.
The exchange revealed that in 2025, it continued investing in risk controls, compliance, and ecosystem development, citing a series of highlights:
Binance said it assisted in recovering $48 million across 38,648 incorrect user deposits.
It added that it helped 5.4 million users and prevented an estimated $6.69 billion in potential scam-related losses.
It said cooperation with law enforcement contributed to the confiscation of $131 million in illicit funds.
It noted that 2025 spot listings spanned 21 blockchains, led by Ethereum, BNB Smart Chain, and Solana.
It reported Proof of Reserves totaling $162.8 billion across 45 crypto assets.
A personal response also came. CZ weighed in publicly, brushing off the latest allegations as a familiar cycle.
“Not the first time, won’t be the last time. Been receiving FUD attacks since day 1. Will address it in the AMA tonight, look below the surface on why and how,” he shared.
The renewed scrutiny of Binance reflects more than a single event or set of claims. It highlights how fragile trust remains in crypto after years of volatility, leverage-driven crashes, and high-profile failures.
In a market still struggling to recover, unresolved questions tend to resurface.
