OKX Star: "10.11" Hundreds of Billions in Liquidations Caused by Binance's Irresponsible USDe Promotional Activity

Odaily News OKX CEO Star posted on the X platform, stating that on October 10th, tens of billions of dollars in cryptocurrency were liquidated, and OKX observed a fundamental change in the microstructure of the cryptocurrency market since that day. Industry insiders believe the losses from this event are more severe than the collapse of FTX. The root cause of the incident was Binance launching a limited-time promotion, offering a 12% annualized yield for USDe and allowing it to be used as collateral with virtually no limits. USDe is essentially a tokenized hedge fund product, structurally different from low-risk money market funds like BlackRock's BUIDL.

Binance encouraged users to swap USDT and USDC for USDe to earn yields but did not adequately emphasize the risks. Users engaged in circular borrowing, using USDe as collateral to borrow USDT and swapping again, artificially creating an annualized yield premium of 24% to over 70%, leading to a rapid accumulation of systemic risk. When market volatility triggered USDe's de-pegging, cascading liquidations exacerbated the crash of assets like WETH and BNSOL. Star pointed out that industry trust cannot be built on short-term yield chasing or marketing that obscures risks, and Binance, as an industry leader, should bear corresponding responsibility.