Binance announced plans to compensate users impacted by extreme market fluctuations on Friday, which led to the decoupling of three significant tokens from their pegs and resulted in forced liquidations.
On Saturday, October 11, the exchange clarified that users who had Ethena’s USDe, BNSOL, or WBETH as collateral from 21:36 to 22:16 UTC on October 10 would be eligible for compensation.
Within that 40-minute timeframe, prices for these assets temporarily strayed from their benchmarks, leading to automatic liquidations.
Binance attributed the situation to unusual market volatility and internal platform complications. Affected users in the Futures, Margin, and Loan products will have their accounts automatically reviewed, with compensation expected to be processed within 72 hours.
Compensation will reflect the difference between the liquidation price a trader faced and the market price at 00:00 UTC on October 11.
Additionally, Binance will refund any liquidation fees incurred during this incident. Users who believe their cases fall outside the stipulated criteria can reach out to customer support for review, although the company specified that standard trading losses and unrealized gains do not qualify.
This compensation initiative comes after a significant liquidation event described by analysts as one of the largest in the cryptocurrency realm.
According to a report by Bloomberg, around $19 billion in positions were liquidated across global exchanges within a single day, impacting approximately 1.6 million traders after news of new US tariffs unsettled the market late on Friday.
During this crisis on Binance, USDe briefly dropped to about $0.65, followed by a rapid rebound, highlighting the scarcity of liquidity amid heightened volatility.
EXPLORE: 20+ Next Crypto to Explode in 2025
The exchange stated that it is conducting a thorough review to prevent similar situations in the future, as users demand more robust protective measures after experiencing one of the most tumultuous trading environments in 2025.
To avert such occurrences, Binance plans to adjust its price index calculations and risk management parameters.
The exchange will now establish redemption prices based on the index weights of BNSOL, WBETH, and USDE, set a price floor for USDE, and conduct more frequent reviews of its risk settings.
In 2023, Binance’s CEO Richard Teng replaced co-founder Changpeng “CZ” Zhao, offering an apology to users impacted during the volatile market conditions.
“I sincerely apologize to everyone affected,” Teng expressed in a post on X. “We do not offer excuses; we listen, learn, and are dedicated to improving.”
Shortly after this communication, Binance provided a detailed follow-up outlining its compensation plan for those traders affected by the liquidation event.
