Binance launched the “Together Initiative,” a $400 million compensation program meant to help users affected by the Oct. 10 crypto flash crash.
Angry users on X have accused Binance of misleading advertising and fake compensation.
The move wiped out roughly $19 billion in crypto market value in one day, leading to $7 billion in liquidations.
Binance’s $400 million compensation plan is facing backlash from traders who accuse the exchange of fake payouts and using paid actors.
The promised “recovery and confidence rebuilding plan” was announced to reimburse affected users from the major liquidation event brought on by the Oct. 10 flash crash.
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On Tuesday, Oct. 14, Binance announced a sweeping $400 million relief package aimed at restoring user confidence after the previous week’s record-breaking crypto crash.
Dubbed the “Together Initiative,” the program said it would roll out compensation and liquidity support measures in the coming days, targeting traders hardest hit by Friday’s flash crash and forced liquidations.
As part of the plan, Binance said it would distribute between $4,000 and $6,000 in token vouchers to affected users, with a total of $400 million allocated for this relief round.
To qualify, users must have lost at least $50 in forced liquidations representing 30% or more of their total account value.
“The amount of each voucher will depend on the user’s loss size, loss ratio, and other considerations,” Binance explained in a Tuesday update, adding that funds would appear in eligible users’ Rewards Hub within 96 hours.
Angry Traders Speak Out
Over the past week, traders have been speaking out on X after being denied compensation by Binance, with many claiming they are not being given “sufficient reasoning.”
One user, who claims to have lost $30,000 in the liquidation, wrote:
“I’ve talked to Binance support for five days and they can’t give me any reason why I’m not eligible for Together compensation.”
Screenshots shared by several users show Binance customer service agents repeating a scripted response outlining eligibility requirements, including losses exceeding $50 and representing at least 30% of a user’s total net assets.
Traders have been speaking out on X | Source: @Crypto_Rookies on X
In another post, a user named @FilmesHGames accused Binance of false advertising, saying they had received no compensation despite meeting all the announced criteria.
“What you are doing right now looks like pure misleading advertising,” the trader wrote in a lengthy post to CEO Changpeng “CZ” Zhao.
“I am a small trader who was directly affected by the recent market crash. I couldn’t buy or sell anything,” they added.
“I had to forcibly close my positions to avoid losing everything. I didn’t receive even one of the thousands of vouchers you claim to be giving to affected users.”
Traders are claiming Binance ignored small traders | Source: @FilmesHGames on X
The user said they had been trading on Binance since 2017 and had previously trusted the platform, but now felt “embarrassed and humiliated.”
“I haven’t been rewarded or recognized for the losses I suffered. It makes me feel like you don’t actually care about small traders affected by the meltdown.”
In a follow-up post, the same user wrote:
“I haven’t received a single cent from the so-called compensation they claim to be paying. I’ll soon be leaving the Binance platform, my friend.”
Binance’s official support account has replied publicly, claiming agents had already explained the criteria “multiple times” and encouraged users to check past messages in their chats.
‘Paid Actor’ Allegations
CEO CZ also faces allegations that he is sharing fake accounts promoting successful reimbursements.
A post on X from user @CryptoCurb accused CZ of reposting fake engagement screenshots that exaggerated how much users received from the exchange’s fund.
🚨 JUST IN: CZ CAUGHT REPOSTING FABRICATED ENGAGEMENT POSTS SHOWING MONEY RECEIVED FROM @BINANCE FLASH CRASH EXCEEDING WHAT WAS ACTUALLY GIVEN OUT
THE ONLY PEOPLE THAT RECEIVED MONEY FROM BINANCE “RECOVERY FUND” ARE PAID ACTORS
“CZ doesn’t even know how much his own recovery fund is and is retweeting fake screenshots,” one user wrote in a widely shared post.
Binance has not yet publicly responded to the specific “paid actors” accusations.
Flash Crash
Global crypto markets experienced a wipeout on Oct. 10, after U.S. President Donald Trump announced a sweeping 100% tariff on all Chinese imports, a retaliatory move against Beijing’s planned export controls on rare earth minerals.
Trump said the escalation, set to take effect on Nov. 1, would also include new export restrictions on “any and all critical software.”
“It is impossible to believe that China would have taken such an action, but they have, and the rest is history,” he wrote on Truth Social.
The surprise policy threat hit crypto markets hard, wiping out around $19 billion in value in a single day, surpassing the 2020 and 2022 flash-crash events.
Over 1.6 million traders saw their positions erased, and $7 billion was liquidated within one hour.
Kurt Robson is a London-based reporter at CCN, specialising in the fast-moving worlds of crypto and emerging technology. He began his career covering local news in Cornwall after graduating from Falmouth University with First Class Honours in Journalism. There, he cut his teeth on everything from council meetings to missing swans.
He quickly rose through the ranks to become a frontline journalist at several of the UK’s leading national newspapers. Over the years, he has interviewed musicians and celebrities, reported from courtrooms and crime scenes, and secured multiple front-page exclusives.
Following the upheaval of the COVID-19 pandemic, Kurt shifted his focus to technology journalism—just ahead of the AI boom. With a natural curiosity and a trained eye for emerging trends, he has found a new rhythm in reporting on innovation.
At CCN, Kurt's work focuses on the cutting edge of crypto, blockchain, AI, and the evolving digital world. Drawing on his background in people-first reporting and his deep interest in disruptive tech, Kurt delivers stories that are insightful, entertaining, and human-centric.
