Binance has unveiled a new $400 million relief plan for some of its customers who were affected by the market crash that occurred over the weekend between Friday, October 10, and Saturday, October 11. The package is aimed at restoring user confidence after a crash that saw some tokens depeg and billions erased from the crypto derivatives market.
According to the largest exchange in the world, the “Together Initiative” would provide both user compensation and institutional support as it works to rebuild trust after the disruption. The announcement comes days after Binance experienced a high-profile glitch that caused Ethena Labs’ USDe and two tokens, BNSOL and WBETH, to briefly lose their pegs, triggering forced liquidations and drawing widespread criticism. Binance had earlier pledged to compensate affected users.
Binance plans compensation package for affected users
According to its statement, Binance promised to distribute up to $300 million in USDC stablecoin to traders who experienced forced liquidations during the most volatile hours of both days of the crash. Eligible users include those whose liquidation losses exceeded $50 and represented at least 30% of their net asset value at the time. Payouts, which the company said will begin in 24 hours, will be sent to individual spot accounts and will end in 96 hours.
In addition, Binance is also expected to establish a $100 million “Institutional Support Program” to offer low-interest loans to ecosystem partners and institutional clients hit hardest by the crash. The fund, designed to alleviate liquidity pressures and help firms resume trading operations, will be accessible to eligible VIP clients through their account managers.
The new initiative comes after Binance’s earlier October 11 announcement that it would fully compensate users affected by the depeg event, which occurred between 21:36 and 22:16 UTC on October 10. During that window, a glitch caused price distortions for USDe, BNSOL, and WBETH. Binance said it has since completed a review and promised to reimburse all impacted users who experienced forced liquidations across Futures and Margin trading from 00:00 on October 10 to 23:59 UTC on October 11.
Safeguards to prevent a repeat in place
The company also introduced several technical safeguards to prevent a repeat, including adding redemption prices into the price index weights of affected tokens, incorporating minimum price thresholds for USDe to improve stability, and conducting more frequent reviews of its risk parameters. Industry observers view Binance’s $400 million relief fund as a symbolic show of solidarity amid intensifying pressure and competition from other platforms.
Binance also said its relief package should not be confused with taking liability for users’ losses. “We expect scrutiny, fair or unfair,” Binance said, adding that its users “are always our first priority.” According to the leading exchange, “It is critical to rebuild industry confidence” after a period of volatility and scrutiny. “This stems from our belief in the long-term development of the industry and our commitment to Binance’s User Focus values,” the company said in the statement.
