OKX CEO Star Xu has publicly blamed Binance for the catastrophic market crash on October 10, 2026, which erased nearly $19 billion from the cryptocurrency market. In a January 31 post on X, Xu asserted the event was not a random accident but a direct result of "irresponsible marketing campaigns" by certain companies, specifically pointing to Binance's aggressive promotion of Ethena's USDe synthetic dollar.
Xu alleges that Binance's user-acquisition campaign offered a 12% annual yield on USDe, encouraging traders to treat the higher-risk synthetic asset with the same collateral terms as traditional stablecoins like USDT and USDC. This, he claims, created a "leveraged loop" where traders converted standard stablecoins into USDe to farm yield, artificially inflating perceived APYs to as high as 70%. "This campaign allowed users to leverage USDe as collateral with the same treatment as USDT and USDC without effective limits," Xu wrote.
The OKX CEO argued that USDe's delta-neutral hedging strategy carries "hedge-fund-level structural risks" obscured by its marketing. When market volatility struck on October 10, this excessive leverage unwound violently. The resulting depeg of USDe on Binance's order book allegedly triggered a cascade of liquidations that risk engines could not contain, severely affecting assets like WETH and BNSOL, with some tokens briefly trading near zero.
However, Binance, Ethena Labs, and other industry figures have forcefully rebutted these claims. Dragonfly managing partner Haseeb Qureshi and Ethena Labs founder Guy Young presented transaction data showing Bitcoin's price had bottomed a full 30 minutes before USDe deviated from its peg on Binance, arguing the depeg was a consequence, not a cause, of the market-wide crash. Binance attributed the event to a "liquidity vacuum," releasing data showing Bitcoin liquidity was "zero or near zero" across major venues, which caused mechanical selling and disproportionate price drops.
The public dispute underscores the intensifying blame game among top crypto exchanges following the October 10 incident, which Xu describes as a "structural break" in crypto market behavior with consequences some consider more disruptive than the collapse of FTX.
