10.11 Binance Mass Liquidations
BlockchainThis Article Revealed the Truth Behind My 10.11 Binance Liquidation
“What Really Happened on the Night of 10.11 Binance Mass Liquidations | Data and Facts Tell the Truth”
At forty, with a pregnant wife and various loans on my shoulders,
I never imagined that October 11th would turn my Binance life into a zero-balance life…
Now I don’t even know how to face the rest of my life — only despair and pain remain.
I was one of the victims of the chain-liquidations during the 10.11 Binance crash.
That early morning, Binance’s system outage wiped out everything I had.
I will never forget what I experienced — the prices were collapsing,
but no matter how many times I clicked, I couldn’t close or reduce my positions.
In the end, all I saw was a zero account and a ruined life.
Binance was the very first crypto app I ever used — and the only one I stuck with.
I chose Binance because of trust.
This time, I submitted an “appeal” to Binance —
the first one I’ve ever filed in all my years of using it.
So far, there’s been no meaningful response or compensation.
My hope is fading…
Then today, I accidentally came across an in-depth article titled:
“What Really Happened on the Night of 10.11 Binance Mass Liquidations | Data and Facts Tell the Truth.”
Reading it filled me with complicated emotions.
By the time I finished, I was shocked beyond words.
For the first time, I clearly understood what had really happened that night.
I finally realized the truth behind everything that occurred.
But when I tried to share the article with friends, it was already deleted.
I don’t know why.
Still, I hope that more victims like me can see this article and learn the full story.
So, I managed to recover the text and now I’m sharing it with everyone affected.
All I ask for is fair and just treatment,
and for Binance to take responsibility for what rightfully belongs to them.
@binancezh @binance @cz_binance @heyibinance @BinanceHelpDesk
Original Article
“What Really Happened on the Night of 10.11 Binance Mass Liquidations | Data and Facts Tell the Truth”
Because I used to do arbitrage between spot and futures,
I have many friends who are market makers.
Many of them knew, directly or indirectly, that I suffered huge losses that day.
Ironically, they too lost money this time.
We exchanged countless phone calls, actively shared evidence, and as the pieces came together,
the truth became clearer and clearer.
I come from a pure science background — I’m detail-oriented and stubborn about facts.
I can’t stand those who exploit crises for their own agendas.
All I want is for people to know what really happened that night:
Was Binance responsible? Were their “compensations” adequate?
I’ll now recount the full event from the perspective of my friend C, a professional market maker.
All the following information has been cross-verified multiple times,
and I can personally vouch for its authenticity.
I’m C, a market maker for XXX.
At 05:12 (UTC+8) on October 11, the market started to accelerate downward.
My trading and risk-control systems, which had been running perfectly for 1,137 days,
hit a physical limit on Binance for the first time.
My algorithm didn’t “add risk.”
Its first reaction was to reduce exposure and cut positions via predefined risk controls.
So, my bot sent multiple ReduceOnly/Close orders —
these are “safety valves,” meant to only reduce, never increase, exposure.
In any sound matching engine, such orders must always have highest execution priority.
The worse the market, the higher their priority.
But this time, it was as if someone had locked the fire exit from the inside.
My system logs showed:
NEW_ORDER_REJECTED (-2010),
then a flood of
ReduceOnly Order Failed (-4118, -2022) and
Server is busy, please try again later (-1008) and
HTTP 503 “Service Temporarily Unavailable.”
My bot repeatedly tried to sell 3,000,000 DOGE to reduce a 3,413,001 DOGE position.
At that time, the collateral was about $656,832,
with unrealized loss of -$266,118.
For XRP, the bot attempted to reduce 7,326.10 down to one-fifth.
But almost every attempt returned the same error.
Over the next 106 minutes,
the bot made more than 200 retry attempts, all failed —
100% rejection rate.
The position stayed fully exposed, losses kept growing,
and by the end, I lost $591,835 USDT in total (DOGE $443,835 + XRP $148,000).
These figures are all verifiable in our logs.
What the Error Codes Really Meant
You can think of Binance’s failure signals as two layers:
- Infrastructure level (HTTP layer): e.g. 503, meaning “service overloaded/unavailable.”
- Business logic level (API error codes): e.g. -1008 (Server busy), -4118 (ReduceOnly failed),
- -2022 (ReduceOnly rejected), -2010 (New order rejected).
Our logs showed both types spiking simultaneously during the critical window.
That means: this wasn’t a client-side network issue —
it was a systemic failure on Binance’s side,
affecting multiple symbols, multiple accounts, at the same time.
Even according to Binance’s own public documentation,
ReduceOnly/Close orders are supposed to be prioritized during congestion.
But in reality, they were rejected first —
directly contradicting their own “priority promise.”
Their cloud infrastructure provider later claimed a “10% order rejection rate,”
but what we saw was nearly 100%.
Others reported the same.
No statistical evidence or audit logs were provided — only verbal statements.
When the safety valve of the system — the ReduceOnly order —
is denied execution during overload,
that’s not a minor glitch.
It’s a core failure of the platform’s risk-control logic.
Market Makers Couldn’t Buy — Liquidity Collapsed
Some blamed market makers for withdrawing liquidity.
That’s completely false.
In times of panic, market makers are usually the ones catching the falling knife —
they have bandwidth, risk systems, and deep capital.
If the system was functioning normally,
no top-50 token like ATOM should have fallen to $0.001.
That happened only because no one could buy.
We suspect later K-line “adjustments” were attempts to hide this.
During that window,
even large market makers with priority API links were locked out.
Buy orders couldn’t enter,
order books thinned,
and Binance — supposedly the deepest liquidity venue —
became the weakest point in the market.
A researcher named Benson later published a
“Binance Deviation Report”,
comparing real-time price deviations across exchanges.
His findings were shocking:
Binance deviated deeper and longer than smaller venues.
(See: x.com/BensonTWN/status/… and binance-deviation-report.github.io)
In simple terms:
The deepest pool fell the fastest —
because its matching engine froze.
The Domino Effect: Systemic Risk Spread
Binance is not just a trading venue — it’s a pricing source.
Its prices feed into indices, mark prices, funding rates, and liquidation thresholds
across the entire crypto derivatives ecosystem.
So when Binance’s price fell abnormally deep,
other platforms that rely on Binance’s data were dragged down automatically,
causing chain reactions of forced liquidations —
a “virus-like contagion.”
In short:
traders’ risk controls failed not because of emotion or greed,
but because their “escape door” was sealed shut by the system itself.
The Portfolio Margin (PM) Account Design Flaw
Binance’s Portfolio Margin system allows one-click liquidation of all positions
into a chosen asset (e.g., ETH, BTC, USDT, WBETH).
But this feature can only be triggered manually in the UI,
not through API or SDK — and its internal logic is opaque.
We suspect that margin checks were skipped during such manual liquidations.
This could explain the bizarre crashes —
like WBETH falling to $460 and BNSOL to $37.
In short, the PM system was immature and unstable,
especially under high concurrency.
This led to a “death spiral” where even 1x leverage accounts
were caught in cascading liquidations.
The Causal Chain
Extreme volatility → ReduceOnly orders sent →
System rejected them (-4118/-2022/-1008/503) →
Positions couldn’t shrink →
Market makers’ bids blocked →
Order books collapsed →
Binance’s price deviated deeper →
Deviation spread to index-linked platforms →
Cross-market chain liquidations →
“Mass extinction event.”
Every step is verifiable by logs, timestamps, error codes, and price charts.
Our conclusion is clear:
This disaster was not caused by trader greed,
nor by market volatility alone —
it was triggered by Binance’s system and mechanism failure.
Accountability
When the system blocks risk-reducing orders in the name of “overload,”
and when the deepest market becomes the weakest,
the incident ceases to be a “price fluctuation” —
it becomes an infrastructure failure.
As the operator of that infrastructure,
Binance owes users an explanation:
- Why was the risk-control channel locked for 106 minutes (05:12–07:02)?
- Why was “ReduceOnly priority” not honored?
- Why did deeper markets fall further than shallow ones?
Market risk is traders’ responsibility.
Systemic risk is not.
When traders take all reasonable steps to manage risk
but are blocked by the platform itself,
the resulting losses cannot be blamed on the user.
We therefore demand compensation and disclosure —
an audit report of Binance’s matching engine
and PM account liquidation logs.
But all we’ve received are excuses and evasions.
One Binance representative even said,
“If we compensate you, we’ll have to compensate everyone.”
Indeed, retail futures traders were the last domino —
and the ones who lost the most.
We’ve confirmed multiple similar losses from other PM accounts.
This reminds us of the CFTC/SEC lawsuit against FTX,
which found that preferential access for large market makers
violated fair-trading principles.
That case resulted in $12.7 billion in restitution.
We’re not spreading emotion or rumor.
We’re stating facts and seeking fairness.
Only facts matter. Only fairness matters.