The former head of Binance has pushed back against claims that the world’s biggest cryptocurrency exchange played a role in last October’s massive market downturn, calling such allegations unrealistic.
Changpeng Zhao, who previously led Binance as chief executive and helped establish the company, spoke during a question-and-answer event held on the exchange’s social media platform. He rejected suggestions that his former company triggered the wave of forced position closures that happened when traders ran into system errors and pricing problems on the site. The exchange later paid out roughly $600 million to affected customers and trading firms.
“There are a larger group who claim the October 10th crash was caused by Binance and wants Binance to compensate everything,” Zhao stated on Friday. “If you are living in those world in your head, you are unlikely to be successful in the future.”
Zhao pointed out that Binance operates under regulatory oversight in Abu Dhabi, where authorities can review the company’s operations. He also mentioned that American government officials keep watch over the platform through a monitoring arrangement.
Speaking as someone who holds shares in the company and uses its services, Zhao gave up his leadership position in November 2023. This came after he admitted guilt in a case involving inadequate money laundering controls. The agreement required Binance Holdings to bring in an outside compliance supervisor to check and evaluate how well the company follows rules. President Donald Trump granted Zhao a pardon in October 2025.
Reports from September 2025 indicated that Binance might reach an agreement with the Justice Department that would end the monitoring requirement.
Historic liquidation event that shook crypto markets
On October 10, traders saw $19 billion worth of leveraged cryptocurrency holdings wiped out in what became the single largest liquidation day in the industry’s approximately 16-year existence. Market observers, including Don Wilson from DRW, voiced concerns about how certain crypto platforms handled the situation, saying they failed to act as neutral marketplaces.
Zhao made clear that Binance customers who lost funds during the October downturn because of platform issues had already received full repayment. The platform distributed $400 million in relief, with $300 million going directly to individual traders who suffered significant liquidation losses and another $100 million set aside for institutional clients facing liquidity pressure.
During the session, Zhao talked about organized negative campaigns targeting him and his former company. He described these as paid internet attacks, cautioning users to watch out for fresh accounts with few followers that spread false information. He warned people with large online followings against taking money to spread attacks, noting such actions damage reputations over time.
Bitcoin supercycle views shift amid global uncertainty
Zhao also shared his changing thoughts on whether Bitcoin would enter a supercycle. While he previously felt confident about this possibility, rising tensions between nations and economic instability have made long-term predictions harder.
He referenced his conversation with gold supporter Peter Schiff, saying Bitcoin has better technology than gold but lacks the same level of worldwide acceptance that gold built up over centuries.
Zhao highlighted Binance’s proof-of-reserves system, which lets users check holdings openly. He brought up December 2022, when the platform handled more than $15 billion in withdrawals over seven days, including about $7 billion in just one day, without stopping operations.
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Source: https://www.cryptopolitan.com/cz-slams-paid-attacks-blaming-binance-for-cryptos-worst-day/
