- Binance will compensate users who lost money due to platform disruptions that caused sharp price drops in multiple tokens.
- Major declines hit assets including wrapped beacon ether (wBETH), Binance Staked SOL (BNSOL), and the synthetic dollar USDe late Friday.
- Compensation will be considered case-by-case, with losses from market fluctuations or unrealized profits not eligible, according to Binance leadership.
- System strain and high market volatility prevented traders from arbitraging and stabilizing token prices, deepening losses.
- Binance changed its pricing model for wrapped tokens to rely on actual staking ratios, aiming to provide more stable values during market turbulence.
Binance has announced it will offer compensation to users affected by technical issues on its platform late Friday, when several tokens experienced drastic price drops. The impacted assets included wrapped beacon ether (wBETH), Binance Staked SOL (BNSOL), and USDe, a synthetic U.S. dollar token. The disruptions happened as market activity surged and volatility spiked.
On Friday evening, the price of wBETH dropped to $430, trading at an 88% discount compared to the ether-Tether (ETH/USDT) spot price, which was above $3,800 at the time. BNSOL also fell to $34.90, well below the market value of solana. USDe, which uses a delta-neutral strategy to track the U.S. dollar, slipped to $0.65 around the same period. Binance co-founder and chief customer officer Yi He wrote on X that users who suffered losses due to the disruptions should contact customer service to file a claim.
She stated that “Due to significant market fluctuations over the past 16 hours and a substantial influx of users, some users have encountered issues with their transactions. I deeply apologize for this. If you have incurred losses attributable to Binance, please contact our customer service to register your case.” Yi He emphasized that “losses due to market fluctuations and unrealized profits are not eligible for compensation”. The company will evaluate accounts individually to determine eligibility.
According to AltLayer founder YQ Jia, posted on X, tokens like wBETH and BNSOL are meant to closely follow the value of their underlying assets. Normally, traders known as arbitrageurs buy undervalued tokens and sell overvalued ones, helping to keep prices stable. However, the recent technical issues and a spike in liquidations prevented these traders from acting quickly, disrupting the usual price alignment.
Jia explained that with Binance handling about half of all global spot trading volume, technical difficulties left market makers unable to access prices or hedge positions. This lack of participation created what he called a “liquidity vacuum,” with effects similar to past financial crashes.
In response, Binance adopted a new pricing standard for wrapped tokens like wBETH. Instead of using current volatile spot prices during periods of stress, the platform will now rely on the tokens’ conversion ratio, based on the amount of underlying assets actually held. This change is expected to offer more accurate and stable pricing during future periods of heightened volatility.
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