Binance's "Together Initiative" Sparks Outrage: Traders Allege Fake Compensation

Key Takeaways

• Binance launched a $400 million compensation program, "Together Initiative," following a significant market crash.
• Many users are now alleging deceptive practices and insufficient compensation.
• Traders are reporting a lack of clear reasoning for compensation denial, leading to accusations of 'paid actors' and misleading advertising.

The Aftermath of the Flash Crash

On October 10th, a market-wide flash crash wiped out approximately $19 billion in crypto value, resulting in $7 billion in liquidations. Binance responded with the "Together Initiative," a $400 million compensation plan intended to restore user confidence and reimburse those affected by the crash.

The program promised token vouchers ranging from $4,000 to $6,000 for eligible users who lost at least $50 and 30% or more of their account value due to forced liquidations.

Rising Discontent

However, the rollout has been met with widespread criticism. Numerous traders have voiced their frustrations on X (formerly Twitter), claiming they were denied compensation without sufficient explanation. Some traders who claim to have lost significant amounts are saying that they've not received anything and support has not given a useful reason.

Several users shared screenshots of Binance support agents providing scripted responses, reiterating the eligibility requirements without addressing individual cases.

False Advertising Accusations

One user, @FilmesHGames, accused Binance of false advertising, stating they met all criteria but received no compensation. They expressed disappointment, stating:

“What you are doing right now looks like pure misleading advertising.”

The user claimed to have trusted the platform since 2017 but now feels “embarrassed and humiliated.”

Allegations of 'Paid Actors'

Adding fuel to the fire, CEO Changpeng "CZ" Zhao is facing accusations of sharing fake accounts promoting successful reimbursements. User @CryptoCurb alleged that CZ retweeted fake screenshots exaggerating the amount users received.

Binance has yet to publicly address these specific accusations, intensifying the controversy surrounding the "Together Initiative."

Note: CCN has contacted Binance for additional comment.