- BTC fell before USDe depeg; structural leverage worsened the October 10 crash.
- Binance’s USDe APY campaign fueled risky cycles, pushing APYs above 70%.
- Dragonfly never invested in OKX; the crash had multiple causes beyond a single platform.
The October 10, 2025, crypto market collapse remains one of the largest in history, wiping out tens of billions of dollars globally. OKX Founder and CEO Star addressed the incident, clarifying key factors that contributed to the volatility.
He emphasized that BTC began falling roughly 30 minutes before the USDe depeg, indicating that the initial shock originated from broader market dynamics rather than a single platform. Star stressed that structural leverage amplified cascading liquidations and that the event could have stabilized without these conditions.
Moreover, Star refuted claims about Dragonfly’s involvement in OKX, stating, “Dragonfly has never been an investor in OKX—neither a minor nor a major one.” He highlighted that OKX invested in Dragonfly before Haseeb Qureshi joined, and one partner’s previous fund—not Dragonfly—invested in OKX. These details aim to correct misinformation circulating about the October crash.
USDe Leverage Loop and Binance Campaign
According to Star, the October 10 crash was aggravated by high-risk marketing campaigns. Binance temporarily offered 12% APY on USDe and allowed it as collateral like USDT and USDC, with insufficient risk limits. USDe, unlike conventional stablecoins, embeds hedge-fund-level strategies, producing inherently higher risk.
Star explained that users converted USDT and USDC into USDe, then borrowed USDT against it, repeating cycles to inflate APYs up to 70%. Consequently, systemic risk built rapidly, and even small market shocks triggered depegging and cascading liquidations, affecting tokens like WETH and BNSOL.
However, crypto analyst Haseeb Qureshi contested Star’s narrative, arguing that USDe’s leverage unwind did not explain the global crash. He noted, “Most of the USDe leverage was much larger in DeFi than in CeFi,” suggesting multiple factors contributed to market instability. Despite disagreements, Haseeb confirmed Star’s accuracy regarding Dragonfly’s non-investor status.
