Here’s How Crypto Crash EXACTLY Happened – Analyst Reveals a Shocking Truth Behind $19B Market Meltdown
A viral post by crypto analyst ElonTrades has taken over X, racking up more than 1 million views to his 187K followers – and for good reason. His breakdown finally explains what really caused the massive October 11 crypto crash, which wiped out nearly $19 billion in market value in just hours.
According to ElonTrades, this wasn’t a random liquidation event or a stablecoin failure. It was a coordinated exploitation of Binance’s internal pricing system, cleverly timed to coincide with Trump’s 100% China tariff announcement.
Let’s break it down.
What you'll learn 👉
It All Started With a $90 Million Dump
The chain reaction began when roughly $60–$90 million worth of USDe, along with wBETH and BNSOL, were dumped on Binance. These assets were being used as collateral inside Binance’s Unified Account system, which – and here’s the key part – valued collateral based on Binance’s own spot prices, not external oracles.
So, when the dump happened, it wasn’t just a price dip – it crashed the internal valuation of all accounts using those tokens as collateral. That instantly triggered $500 million to $1 billion in forced liquidations across Binance alone.
To make matters worse, this was no coincidence. Binance had already announced a switch to oracle-based pricing back on October 6 – but the rollout wasn’t scheduled until October 14, leaving an eight-day window that the attackers exploited perfectly.
The Oct 11 Crypto Crash — What Really Happened
— ElonTrades (@ElonTrades) October 12, 2025
TL;DR:
Roughly $60–90M of $USDe was dumped on Binance, along with $wBETH and $BNSOL, exploiting a pricing flaw that valued collateral using Binance’s own order-book data instead of external oracles.
That localized depeg triggered…
The Perfect Exploit
During that brief window, the attackers pushed USDe down to $0.65 on Binance – while it remained stable around $1 everywhere else. Because Binance’s system marked collateral to its own internal prices, those positions got instantly liquidated.
And right in the middle of that chaos came Trump’s tariff announcement, adding a layer of panic that made the move look like a macro-driven crash.
But it wasn’t. It was precision timing.
The $192 Million Payday
Here’s where it gets interesting. ElonTrades notes that new wallets appeared on Hyperliquid just hours before the crash, opening $1.1 billion in BTC and ETH shorts, funded by $110 million USDC from wallets linked to Arbitrum.
As Binance’s liquidation cascade began, Bitcoin and Ethereum tanked – and those shorts cashed out with $192 million in profit at the bottom. The timing, the funding, and the coordination all lined up too perfectly to be coincidence.
From Binance to the Entire Market
The forced liquidations on Binance spilled over instantly. Once Binance dumped BTC, ETH, and alts into thin books, other exchanges followed through cross-market bots and hedging algorithms.
Market makers tried to cover positions everywhere at once, which only deepened the selloff. Within hours, the entire market collapsed – over $19 billion in value gone, and many altcoins down 50–70% intraday.
All triggered by less than $100 million in manipulated collateral.
Read also: Crypto Crash Opportunity: The Best Coins to Accumulate Right Now
Who’s Really to Blame?
According to ElonTrades, the responsibility falls on both sides:
- Binance, for creating a vulnerable system that priced collateral using internal order books instead of independent oracles – and for delaying the fix.
- Exploiters, who took advantage of that weakness, timed the attack perfectly, and profited through external shorts.
One group that wasn’t at fault? Ethena’s USDe stablecoin. ElonTrades made it clear: “It wasn’t a USDe failure.” The protocol stayed 1:1 collateralized, redemptions worked normally, and the peg held everywhere else.
The Aftermath
Binance has since acknowledged “platform-related issues”, promised compensation to affected margin, futures, and loan users, and finally implemented both oracle integration and minimum price floors to prevent this from happening again.
Meanwhile, USDe continues to function normally – and the entire episode has become a real-world case study in how exchange-side pricing errors can spiral into global chaos when combined with leverage and timing.
Disclamer: This article is for informational purposes only and does not represent the views or opinions of CaptainAltcoin. We are reporting on publicly available information and social media commentary – specifically, a viral thread shared by analyst ElonTrades on X. None of the statements or claims made in this piece should be interpreted as verified facts, financial advice, or accusations. Always conduct your own research before making any investment or trading decisions.
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