Wintermute CEO Dismisses Binance Lawsuit Talk Amid Post-Crash FUD

Evgeny Gaevoy, the CEO and Founder of crypto market maker Wintermute, has refuted rumors circulating on social media that his firm is preparing a lawsuit against Binance following October’s massive market crash that wiped out more than $20 billion in leveraged positions across crypto exchanges.

Speaking on X in relation to his October 11 post, Gaevoy said that his stance hasn’t changed since then and the talks about his plans to sue Binance are baseless rumors.

The clarification directly addressed growing speculation that Wintermute had suffered significant losses and was pursuing legal action against Binance. The claims emerged shortly after the October 10 crash, one of the largest liquidation events in recent crypto history.

WhalePump Rumor Sparks FUD

The speculation appears to have originated from an X user known as WhalePump Reborn, who claimed that Wintermute was impacted by Binance’s auto-deleveraging (ADL) mechanism and was demanding compensation.

The user further alleged that “Binance completely disagrees with the amounts Wintermute is asking for.”

Gaevoy publicly called out the user while replying on the thread, “What a larp, all complete bullshit.”

Despite the lack of evidence, the claim quickly spread across Crypto Twitter, fueling widespread fear, uncertainty, and doubt (FUD) amid an already jittery market.

Even former Binance CEO Changpeng “CZ” Zhao weighed in, urging his 10.4 million followers to trust only verified information. “If someone made you believe otherwise, it’s time to click unfollow,” CZ wrote in response to Gaevoy’s post.

A $20 Billion Liquidation Event

The October 10 market crash has been described by analysts as one of the most dramatic liquidation spirals in crypto’s history. Within hours, more than $20 billion in leveraged positions were erased as cascading margin calls and thin liquidity triggered a chain reaction across exchanges.

The selloff was sparked by the U.S. President Donald Trump’s China tariff announcement, which sent Bitcoin tumbling from $121,560 to below $103,000, dragging down altcoins and derivatives markets in its wake.

Binance later confirmed it had paid $283 million in compensation to affected traders after synthetic assets USDe, BNSOL, and WBETH went off-peg during the turmoil. The exchange also announced a $400 million market recovery initiative, including $100 million in low-interest capital to help institutional clients resume trading.

It remains unclear whether Wintermute was among the recipients of Binance’s compensation package.

Gaevoy: “Wintermute is Perfectly Fine”

In his October 11 post on X, Gaevoy sought to reassure followers that the firm had weathered the storm. “Sorry to disappoint you, but Wintermute is perfectly fine, business as usual,” he wrote.

In a subsequent episode of the “Big Brain” podcast, Gaevoy acknowledged that some of the firm’s liquidations during the crash occurred at “very weird” and “completely ridiculous” prices, but stressed that the company’s systems functioned as designed and risk controls performed effectively.

Blockchain data shows that Wintermute, which is one of Binance’s largest liquidity providers, transferred more than $700 million in digital assets to Binance hours before the crash, and then withdrew roughly the same amount shortly afterward.

Gaevoy confirmed during the podcast that the large fund movements to and from Binance were simply part of Wintermute’s routine liquidity operations, not a sign of any financial trouble.

Stability Over Speculation

Wintermute’s quick and clear response helped ease market jitters. Traders took Gaevoy’s denial as reassurance that major market makers remain stable despite the October crash.

Analysts noted that if Wintermute had actually moved toward legal action against Binance, it could have easily reignited fears of another industry-wide meltdown. The kind seen in 2022, when collapses of firms like Three Arrows Capital and Alameda Research set off a chain reaction across the crypto world.

Binance’s Crisis Management

For Binance, the absence of any legal confrontation comes as a relief. Binance has been under growing regulatory scrutiny in several countries this year, but it still dominates global crypto trading by volume.

By moving fast to compensate traders and roll out a rescue fund, Binance signaled that it was ready to take responsibility and keep the market steady. The move stood out in a space where big exchanges have usually been slow to react, or sometimes didn’t react at all, when things went wrong.

Lessons from the FUD Cycle

The Wintermute episode also showed how fast rumors can take off in crypto and turn into full-blown panic within hours. One careless post on X can whip up panic and move markets before anyone checks the facts. It’s a reminder that in this industry, information moves at the speed of emotion, and facts usually arrive a few steps late.

In this case, both Gaevoy and CZ intervened publicly within hours, preventing the rumor from escalating further — a sign, experts say, of a maturing market infrastructure that prioritizes transparency over silence.

Market watchers noted that while Crypto Twitter still has the power to move markets, leading players have become more careful with communication. This is a shift that’s helping to prevent rumors from triggering liquidity shocks.

A Calmer Market After the Storm

While the October 10 crash remains a reminder of the risks that high leverage and thin liquidity pose to digital markets, Wintermute’s response, calm, direct, and unequivocal, has reassured traders that key market makers remain solvent and stable.

For Binance, the clarification removes another layer of pressure at a time when the exchange is already dealing with regulatory challenges worldwide. For Wintermute, it has helped strengthen its image as a disciplined trading firm that stays focused and avoids unnecessary drama, even in the middle of market turmoil.