A DeFi analyst known as Tracer has released an investigation claiming that market maker Wintermute and cryptocurrency exchange Binance acted in a coordinated manner during the sharp crypto market downturn in October. According to the report, transactions between the two entities allegedly triggered the liquidity collapse that wiped out around $500 billion in market value.
Tracer states that shortly before the crash, approximately $700 million was transferred from Binance to Wintermute. The funds were then followed by large-scale sell-offs, leading to a steep drop in asset prices across the market.
The analyst also notes that over the span of 30 days, more than $34.5 billion in digital assets moved between Binance and Wintermute. These transfers consistently occurred ahead of major sell-offs, which, in his view, eliminates the possibility of coincidence. Tracer emphasizes that the timing of transactions was closely synchronized, suggesting pre-planned market activity.
The October 10 flash crash unfolded within roughly 90 minutes. At 07:00 (MSK), Binance reportedly sent $700 million to Wintermute. By 07:30, heavy selling began, and by 08:00, market liquidity had nearly evaporated. This chain of events triggered liquidations of leveraged positions totaling approximately $19 billion, with altcoins suffering the sharpest declines.
Wintermute has previously stated that it operates using a “market-neutral” strategy, claiming its trading activity does not influence market direction. However, Tracer argues that the firm actively leverages liquidity dominance and execution speed to shape market movements while maintaining the appearance of normal volatility.
Rumors of potential legal action against Binance and Wintermute were quickly denied by both parties. However, the speed of their response has only increased speculation regarding close coordination.
Tracer concludes that this pattern of behavior repeats during every major macroeconomic market event, warning that retail traders are consistently left at a disadvantage.
He advises investors to avoid active trading until liquidity conditions stabilize, claiming Binance and Wintermute have the capacity to “turn the market on and off” at will, using their control over liquidity to benefit at the expense of smaller participants.
