Wintermute CEO Evgeny Gaevoy has denied rumors that his company plans to sue crypto exchange Binance for losses incurred during the October 10 flash crash.
“We have never had any plans to sue Binance and see no reason to do so in the future,” the CEO said wrote on X. “I should probably ask to make a note of all the people spreading baseless rumors, but most people believe these have the memory capacity of goldfish, so I won’t.”
The rumors started after reports on X claimed that Wintermute, a market making and trading firm that provides liquidity on Binance’s platform, suffered heavy losses during the flash crash due to a glitch in Binance’s automatic deleveraging mechanism.
X-user claims Wintermute is ready to take legal action
X user “WhalePump Reborn” claimed that Wintermute was preparing to file a lawsuit against Binance to get compensation for the unconfirmed losses.
“Wintermute is suing Binance,” said the X user. “They have lost hundreds of millions.”
YES.
Wintermute sues Binance.
And they’re not the only ones who got stretched.
They lost hundreds of millions.
I have all the names of who’s about to explode.
It won’t be pretty.
Unless CZ finds a way to compensate, this is going to be a bad thing.
For weeks… https://t.co/OTMmztcyzP
— WhalePump Reborn (@WhalePumpReborn) November 3, 2025
“Everything is ready to be submitted as Binance completely disagrees with the amounts Wintermute is asking for,” the user said in a comment below his post.
WhalePump Reborn also claimed that several other crypto trading firms were also preparing to sue Binance, and that he had direct messages (DMs) made by Wintermute’s CEO “literally begging everyone to join the lawsuit.”
The account added that Binance and Wintermute “will deny everything while trying to reach a last-minute agreement to avoid further damage.”
“What a larp, all complete nonsense,” Gaevoy replied.
Wintermute CEO previously said company had ADL at ‘ridiculous prices’
The rumors followed an interview with Gaevoy shared on October 20 by the crypto testers of the X account, which was viewed 132,000 times.
Gaevoy said Wintermute automatically deleveraged on exchanges like Binance “at ridiculous prices.”
Binance’s auto-deleveraging mechanism was activated during the market crash, but resulted in short liquidations at prices as high as five times the prevailing market interest rate.
Gaevoy predicted in the interview that crypto exchange platforms will face a number of challenges and lawsuits from trading firms due to the way their systems responded during the market collapse.
“Some of the ADL refills we got were very strange,” Wintermute’s CEO said in the interview.
An on-chain analysis of Wintermute’s ten tracked wallets across Ethereum, Arbitrum, and Solana found that the company’s portfolio fell 12% following the October 10 flash crash, from $637 million to $572 million.
The analysis shows no large withdrawals exceeding $10 million or liquidation patterns involving Compound or Aave. However, there was a single inflow of 1,000 BTC worth approximately $61 million that occurred on October 4, just days before the flash crash.
Binance co-founder CZ weighed in
After the market crash, Binance paid out $188 million from its insurance fund. It also issued $283 million in refunds for oracle-related depegs. But losses from the exchange’s ADL were excluded from compensation.
Former Binance co-founder Changpeng Zhao, known by his nickname CZ, told his 10.4 million followers on
😆🤷♂️
If someone has led you to believe otherwise, it’s time to hit unfollow. https://t.co/rlkg811qNq
— CZ 🔶BNB (@cz_binance) November 3, 2025
The October 10 flash crash caused the crypto market to experience one of the largest liquidation events in history, wiping out more than $19 billion from leveraged trading positions in a single day. This flash crash also erased approximately $600 billion from the crypto market cap.
The reason for this was that US President Donald Trump threatened to impose a 100% additional trade tariff on exports from China.
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