OKX CEO Accuses Binance of Causing Crypto Flash Crash

OKX CEO Star has accused Binance of causing the October 10th crypto market flash crash through irresponsible marketing practices. In a statement on the X platform, Star claimed that Binance’s temporary user acquisition campaign, which offered a 12% APY on USDe and allowed it to be used as collateral like USDT/USDC, led to systemic risks. Users were encouraged to convert USDT/USDC to USDe for high returns, but the associated risks were not fully disclosed.

The campaign reportedly resulted in artificially high APYs, with some users achieving yields of over 70% by repeatedly converting USDe to USDT as collateral. This practice, perceived as low-risk due to the involvement of major platforms, rapidly accumulated systemic risk in the crypto market. As volatility increased, USDe decoupled, triggering a chain of liquidations and exacerbating the crash. The incident caused significant damage to global users and companies, including OKX clients, with recovery expected to take time.