In early October, the cryptocurrency market experienced unprecedented liquidations, sparking debates on the accuracy of data reporting by exchanges. Jeff Yan, founder of Hyperliquid, argued in a social media post that major centralized exchanges, such as Binance, are underreporting data by nearly 100 times compared to decentralized solutions like Blockchain. This controversy emerged after the announcement of a 100% tariff on China, which further amplified the liquidation scale to over $19 billion. As the week started, Bitcoin 
$78,121 managed to regain its value to $115,000, while Binance disclosed a $283 million compensation to affected users.
Hyperliquid’s Claim of True Transparency
Jeff Yan emphasized Hyperliquid’s capability to record every order, trade, and liquidation on the Blockchain, ensuring verifiable and transparent transactions. In contrast, he criticized centralized exchanges for making thousands of liquidations appear as a single entry within seconds. This highlights the critical need for transparency and neutrality in the global financial infrastructure. Hyperliquid also claimed no disruptions occurred during the spike of liquidations, maintaining swift and seamless transactions.
Following the announcement of high tariffs from Donald Trump, the market saw a series of liquidations, prompting discussions about risk management and transparency deficiencies. Reports indicated that liquidations reached historical levels, with exchange reporting practices at the center of scrutiny.
On the other hand, Changpeng Zhao from Binance responded to the rumors, clarifying no current ownership or ties between Binance and Hyperliquid. Amid accusations of market flow misdirection, calls for clarity and the establishment of standardized data reporting methodologies have intensified.
Record Liquidations Impacting Cryptocurrencies
Last week witnessed liquidations exceeding $19 billion within 24 hours, highlighting the dark side of the leverage surge. Hyperliquid’s notable presence in over $10 billion of these liquidations spurred further debate, increasing expectations for investor protection and data transparency.
Crypto.com CEO Kris Marszalek questioned the fairness of applications on platforms with the highest liquidations, drawing regulatory attention. Market participants are advocating for a unified framework covering thresholds, index baskets, and liquidation reporting.
Binance committed to two rounds of payments totaling approximately $283 million to cover verified losses linked to USDE/BNSOL/WBETH collateral, due to transfer/redeeming delays. Additionally, technical explanations and consistent risk controls have been shared to manage extreme price movements.
