Binance Under Fire: Unpacking the Lingering Distrust on Crypto Twitter

The crypto community's relationship with its largest exchange is facing another severe stress test. A wave of renewed criticism targeting Binance and its co-founder Changpeng 'CZ' Zhao has flooded Crypto Twitter, blending technical grievances with broader accusations of market influence.

The core of the controversy stems from the market turmoil of October 10, 2025—dubbed "Crypto Black Friday." Triggered by macroeconomic announcements, the crash saw Bitcoin drop ~10% and major altcoins plunge over 15%, leading to a record $19+ billion in liquidations. While initially seen as a market-wide panic, questions soon emerged about the role of exchange infrastructure.

During the peak volatility, numerous Binance users reported frozen accounts, failed stop-loss orders, and platform access issues. Assets like Enjin (ENJ) and Cosmos (ATOM) experienced flash crashes, while several Binance-listed tokens, including USDe and wBETH, temporarily lost their pegs.

Binance acknowledged "brief technical glitches" due to "heavy market activity" but maintained user funds were safe. The exchange later compensated affected users with approximately $283 million and launched a $400 million support initiative. However, for many, the explanations and remediation came too late, seeding lasting doubt.

Now, in 2026, with the market still struggling to reclaim pre-crash levels, these doubts have crystallized into formal allegations. Analysts and traders are circulating what they claim is evidence of irregular wallet activity and advantageous positioning by entities linked to Binance in the hours before the crash. One specific claim involves a new account allegedly building over $1 billion in short positions just before the collapse.

Further fanning the flames, industry figures like OKX founder Star Xu have commented on the "real and lasting damage" of the October event, emphasizing the need for exchanges to prioritize infrastructure and trust. Meanwhile, Ray Youssef, CEO of NoOnes, offered a more conspiratorial take, suggesting Binance has become a U.S.-aligned instrument for a "controlled demolition" of the crypto market.

Binance has responded by projecting strength. The exchange announced plans to convert its entire $1 billion SAFU (Secure Asset Fund for Users) reserve from stablecoins to Bitcoin within 30 days—a move interpreted as a bold statement of confidence. In an open letter, Binance reiterated its commitment to elevated standards and continuous improvement. CZ himself dismissed the latest allegations as part of a familiar, cyclical pattern of criticism.

Community Voices:

"Sarah Chen, Portfolio Manager at Vertex Digital Assets": "The technical issues during Black Friday were severe, but not unique to Binance. The real issue is the opacity. When liquidations happen at that scale, and users feel systems failed them, trust evaporates. Binance's compensation was a step, but it doesn't answer the pre-cash positioning questions."

"Marcus Thorne, Independent Trader": "This is a witch hunt fueled by losses. People got liquidated and want someone to blame. I reviewed the public chain data they're citing—it's circumstantial at best. Exchanges are complex systems that buckle under unprecedented load. It's simple physics, not malice."

"Anya Petrova, founder of Decentralized Matters blog": "It's absolutely systematic! They've grown too powerful. The flash crashes, the 'glitches' that always seem to benefit the house, the cozying up to regulators after years of operating in the grey. CZ talks about 'building,' but this is about control. Retail traders are just cannon fodder in their profit playbook."

"David Park, Fintech Analyst at Aegis Insights": "This saga is less about a single event and more a symptom of crypto's adolescence. The market lacks the robust, independent surveillance of traditional finance. Until we have universally accepted standards for proving market integrity, these cycles of accusation and defense will continue every time there's a major downturn."

The resurgence of these claims underscores a fragile reality for cryptocurrency: in a sector built on decentralized trust, the concentration of power in a few key entities remains a point of intense vulnerability and scrutiny. As the market searches for a footing, unresolved questions from past crises inevitably resurface, demanding answers that go beyond compensation and public relations.