The wave of intense market activity on October 10 shocked both traditional and digital markets and exposed the limitations of major centralized crypto exchanges.
The chaos began shortly after US President Donald Trump announced a 100% tariff on imports from China. The policy surprise caught investors around the world by surprise, triggering a selloff that spread from stocks to digital assets within minutes.
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President Trump’s tariff shock exposes cracks in major virtual currency exchanges
Following this announcement, crypto traders reacted in two different ways. Some people were in a hurry to cut their losses, while others were eager to buy on the spur of the moment.
The simultaneous spike in orders overloaded several exchanges, including Binance, Coinbase, Gemini, Kraken, and Robinhood.
As a result, the trading engine struggled to keep up with demand, with several social media users reporting frozen dashboards, price discrepancies, and failed trades.
However, Binance and Coinbase later stated that the disruption was caused by extreme user activity rather than a security breach.
Although most platforms restored normal service within hours, the episode sparked debate about whether centralized exchanges can scale fast enough during events of major volatility.
While centralized platforms struggled to stay online, decentralized finance (DeFi) protocols operated almost without interruption.
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Aave founder Stani Krechov described the market crash as “the biggest stress test in DeFi history.” During the period, the lending platform liquidated approximately $180 million in collateral within an hour with no downtime or transaction errors.
Zach Rynes, Chainlink’s community representative, attributes its performance to a reliable on-chain price feed that allows automated liquidations to occur in real-time.
Similarly, Hyperliquid, a top decentralized derivatives exchange, reported zero latency despite record traffic volumes. We credit the HyperBFT consensus system with helping maintain throughput and solvency.
On Ethereum, Uniswap processed an estimated $9 billion in daily transaction volume, well above the norm, with no noticeable slowdowns.
Meanwhile, that resilience extended to the Solana ecosystem, with Camino Finance ensuring zero non-performing loans while the network itself processed up to 10,000 transactions per second.
Paul Flambot, CEO of Morpho Labs, said of the strong performance of these DeFi protocols that the resilience of DeFi highlights why open and programmable financial infrastructure will ultimately outlast traditional intermediaries.
Coinbase Base network executive Antonio Garcia Martinez echoed this sentiment, adding:
“The fact that we have a financial infrastructure that manages billions of dollars running in a decentralized way as literal code between machines owned by strangers who don’t trust each other is one of the great technological miracles of our time. There are cathedrals everywhere that anyone with eyes can see.”
