Binance Response to ACT Price Plunge: Four Users Shorted ACT Tokens Worth Over $1 Million in Total Value, Leading to a Cascade of Other Token Prices as Some Users' Contracts Were Liquidated During the Decline

On April 2nd, Binance responded to the recent sharp decline of certain meme coins like ACT. It stated, "After a preliminary investigation, we found that individual small-cap tokens experienced a cascading price drop event. This included 3 VIP users engaging in coordinated selling of approximately 514,000 USDT worth of tokens on the spot market within a short period, and 1 non-VIP user depositing a large amount of ACT from another platform and quickly selling around 540,000 USDT worth of tokens on the spot market." During the price drop, some users' futures contracts were liquidated, which led to the decline of other tokens as well. As of now, we have not identified any large profit-taking single account. Since the token is already fully circulating in the secondary market, the platform is unable to intervene in any user's selling behavior. We will continue to investigate this incident, and if there are any updates, Binance will further disclose relevant details. Binance regularly adjusts leverage based on the liquidity, market sentiment, and trading volume of all trading pairs. To proactively mitigate potential volatility and risks, we have voluntarily implemented a leverage reduction measure. Binance Futures has recently issued successive adjustment notices for the ACTUSDT perpetual contract. During this period, the market has not shown any abnormal movements, and we have not forcibly liquidated any user positions. Market makers are a crucial part of the industry ecosystem, and Binance also provides a comprehensive market maker program to encourage more market makers to join Binance and enhance market liquidity. Given the recent significant market fluctuations, to ensure the security of users' assets and reduce trading risks, Binance will promptly adjust leverage according to market conditions to mitigate systematic risks across the entire trading market. Binance also reminds all users to implement appropriate risk management strategies.