Last Friday, crypto markets saw a sudden $600 billion loss within half an hour, impacting 1.7 million wallets through forced liquidations, according to reports. This event has prompted some victims to consider legal action against centralized cryptocurrency exchanges (CEXs).

Claims of collective losses exceeding $100 million have emerged in social chats, and discussions are ongoing about potential remedies. Experienced victims are seeking lead plaintiffs worldwide who suffered significant losses to form class-action lawsuits.

Founder of Defiance Capital, Arthur Cheong, offered his expertise in commercial litigation to support victims. He invited those affected to contact him directly, noting his background in high-stakes legal matters. “If you suffered material losses on CEX during the flash crash of 10th October and would like to get advice on pursuing this further, feel free to dm me,” Cheong stated on X.

Focus has shifted to Binance because the exchange reported some of the lowest prices and extreme losses during the crash, including a 99.9% price drop anomaly. Litigation interest is reinforced by Binance’s large customer base, capacity for settlements, and public payouts made after the event.

Binance made several payments following the crash. First, it disbursed about $283 million to users affected by the depeg of stablecoins USDE, BNSOL, and WBETH, detailed in their official announcement. Next, $100 million in low-interest loans and $300 million in rewards vouchers were allocated to customers who lost at least $50 during forced liquidations, according to company statements. Lastly, $45 million was paid to investors who suffered losses on the BNB memecoin, confirmed on X.

Despite these payments, Wintermute CEO Evgeny Gaevoy highlighted unresolved issues. Wintermute faced Auto-DeLeveraging, or ADL, at unusual prices on Binance and other exchanges. ADL is a risk management mechanism where the exchange forcibly closes positions to reduce risk. Gaevoy described the prices during ADL as “very strange” and shared that the firm is reviewing legal options. Details were shared on X.

Legal experts suggest class actions help victims by combining claims to reduce legal costs and increase impact. There was no immediate response from Cheong when asked for further comment before publication.

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