Bitcoin Liquidations May Be Understated as Hyperliquid, CoinGlass Say Binance’s Reporting Could Undercount Mass Liquidations

• Binance reports only one liquidation per second per pair, which can miss many orders during bursts.

• CoinGlass and Hyperliquid say reported figures likely understate total liquidations; exchanges’ internal snapshots are batched for performance.

• Data: CoinGlass recorded $16.7B long and $2.456B short liquidations in the October flash crash — the largest on record.

Binance underreports liquidations during the October crash — analysis of snapshot limits, CoinGlass and Hyperliquid data, and what traders should do. COINOTAG.

Published: Oct. 6, 2025 · Updated: Oct. 6, 2025 · Author/Organization: COINOTAG

How does Binance underreport liquidations?

Binance underreports liquidations because its Liquidation Order Snapshot Stream sends only the latest liquidation recorded within each second interval. When many forced liquidations occur in the same second, that batching approach can omit earlier executions, producing a lower apparent liquidation total versus the actual executed volume.

What is the Liquidation Order Snapshot Stream and why does it matter?

The Liquidation Order Snapshot Stream is a real‑time data feed that publishes forced‑liquidation updates. For performance, Binance batches outputs and, per its documentation, emits the last liquidation in each one‑second window. That design reduces throughput but, according to Hyperliquid CEO Jeff Yan and crypto data provider CoinGlass, can fail to reflect surge activity where exchanges may process tens to hundreds of liquidations per pair per second.

Hyperliquid co‑founder and CEO Jeff Yan said the reporting method “could easily be 100x under‑reporting under some conditions.” CoinGlass likewise posted that “the actual [liquidated] amount is likely much higher” because “Binance only reports one liquidation order per second.” These statements come amid broad market turmoil and are reported here as claims from those firms.

Source: CoinGlass

$19 billion liquidation event

Bitcoin (BTC) tumbled to roughly $102,000 on Friday after a major macro announcement, while Ether (ETH) slid to about $3,500 and Solana (SOL) dropped beneath $140, triggering a marketwide sell‑off. CoinGlass’s aggregate figures indicate approximately $16.7 billion in long liquidations and $2.456 billion in short liquidations during the event — the largest single‑day liquidation total on record.

The snapshot limitation is material because liquidations tend to occur in concentrated bursts. Binance’s per‑second snapshot design means only the final liquidation in any given second is visible in that stream, while internal matching and execution engines may have processed many more orders in the same interval.

Hyperliquid reported that more than 1,000 HYPE wallets were wiped out during the crash. Lookonchain data — reported as a plain text source — shows over 6,300 wallets moved into net loss positions with combined unrealized losses exceeding $1.23 billion.

Total crypto liquidations chart. Source: CoinGlass

Related: Crypto liquidations hit $1.8B in a day: Final flush or more to come?

Centralized finance stumbled

Centralized trading platforms reported assorted issues during the flash crash. Binance, in particular, faced criticism after users reported UI anomalies, frozen stop and limit orders, and displayed prices of $0 for some assets during peak volatility.

Binance CEO Yi He stated that the exchange’s core contract and spot matching engines and API trading “remained stable,” but acknowledged that “some individual functional modules of the platform did experience brief lags, and certain wealth management products experienced de‑pegging.” She added that Binance “initiated and completed compensation” for users affected by depegging, totaling over $280 million, per Binance’s public statements.

Users and independent observers reported that at times only liquidations appeared to execute cleanly. One pseudonymous trader, Hanzo, described the experience: “On Binance, buttons stopped working. Stop orders froze, limit orders hung, only liquidations were executed perfectly.” Binance attributed the $0 display anomaly to recent changes in minimum price decimal places for certain trading pairs and characterized it as a display issue rather than a market price of zero.

DeFi platforms show greater resilience

Decentralized finance venues demonstrated varying resilience. The Ethena USD (USDE) stablecoin maintained its peg on Curve, while it deviated substantially on Binance and Bybit. Haseeb Qureshi, managing partner at venture firm Dragonfly, noted that USDE fell to roughly $0.95 on Bybit and under $0.70 on Binance but stayed pegged on Curve.

Source: Haseeb Qureshi

Guy Young, founder of Ethena Labs, said USDe minting and redeeming functioned “perfectly” during the crash and shared data indicating around $2 billion in USDe redemptions across exchanges and DeFi platforms in a 24‑hour window. Tom Cohen, head of investment and trading at Algoz, told reporters that the cascade began with a large simultaneous dump of USDe — estimated at $60–$90 billion in his view — which then moved thinly traded markets rapidly, per his analysis.

Hyperliquid reported its decentralized platform experienced zero downtime or latency despite record traffic, framing the episode as a stress test that validated its fully on‑chain approach.

Magazine: Bitcoin may move ‘very quick’ to $150K, altseason doubts: Hodler’s Digest, Sept. 28 – Oct. 4

Frequently Asked Questions

How many liquidations might Binance have missed in the October crash?

There is no precise public count of missed liquidations. CoinGlass and Hyperliquid argue Binance’s per‑second reporting can omit multiple orders per second; Jeff Yan suggested underreporting could reach 100x in extreme bursts. These are claims from data providers and should be interpreted as analytical assessments rather than audited totals.

Did Binance’s display issue cause the liquidations?

Binance described the $0 price displays as a UI display issue tied to decimal‑place changes for certain pairs, not price execution. However, multiple user reports indicated order entry and order‑type responsiveness problems during the same window. Binance also reported compensation actions exceeding $280 million for affected users.

Key Takeaways

• Data limitations matter: Binance’s snapshot stream design can omit multiple liquidations within the same second, potentially understating real volumes.
• Cross‑platform differences: DeFi protocols such as Curve and Ethena maintained peg and redemption functionality while centralized venues showed display and functional anomalies.
• Practical action: Traders should corroborate exchange reports with independent data providers like CoinGlass and internal on‑chain checks and adjust risk controls for burst liquidity events.

Conclusion

Binance underreports liquidations when its per‑second snapshot model hides multiple forced orders executed in the same interval, according to Hyperliquid and CoinGlass. Verified data from CoinGlass and blockchain‑level reporting, plus commentary from industry participants such as Haseeb Qureshi, Tom Cohen and Guy Young, underline the importance of cross‑checking exchange feeds with independent sources. As markets evolve, traders and risk managers should prioritize multi‑source surveillance and robust fail‑safes to mitigate the impact of rapid, bursty liquidation events.