Analysis: ACT flash crash was caused by Binance adjusting ACT's leverage position limit, and the excess positions of market makers were closed at the market price

Odaily Planet Daily News Coinkarma founder Benson Sun published an analysis on the X platform, saying, "At 18:30 today, ACT suddenly crashed by 50%. The reason was that Binance adjusted the leverage position limit of ACT. A maximum of 4.5 million US dollars can be opened with a leverage of one times. Some market makers' positions exceeded the limit and were directly closed at the market price. After the contract price collapsed, there was a huge price difference with the spot price, and the spot price also collapsed. This time, Binance issued an announcement at 15:32 on April 1, and the effective time was 18:30 on April 1. The user reaction time was less than 3 hours. What's even more outrageous is that Binance had already issued an announcement on March 31 to modify the position limit of ACT, and on April 1, the position limit for low leverage was cut again. 50%. Before modifying the rules, Binance should first evaluate how many positions will be closed. If there are market makers with large positions, they should also be notified in advance. As an industry leader, I hope Binance can handle this incident properly. ”