Beyond the Candle: The Crypto Apocalypse of October 10
Summary
On October 10, 2025, the cryptocurrency market experienced the largest liquidation event in its history, $19 billion in leveraged positions were eliminated within 24 hours, with some estimates placing the total above $30 billion when delayed exchange reporting is accounted for. This event erased ~$1 trillion in total market capitalization and exposed critical structural fragilities in crypto market infrastructure.
In this article, we examine the trigger behind this crash, how the events unfolded, and what worked and what failed, during this historic market meltdown.
The Macro Catalyst: Trump's Tariff Threat
President Trump's October 10 announcement threatening 100% tariffs on all Chinese imports starting November 1 served as the catalyst. Within three hours, Bitcoin crashed from $123,000 to $102,000, a $20,000 or 16.9% drop, erasing $380 billion in BTC market cap alone. Ethereum fell from $4,346 to $3,574 (17.8% decline), Solana dropped 30%, Cardano plummeted 30%, and select altcoins crashed 60-90%. An altcoin index recorded a near-40% collapse within minutes.
Liquidation Cascade: Exchange-Level Breakdown
The liquidation event unfolded with unprecedented velocity, approximately $7 billion was liquidated in a single hour on Friday evening. Exchange-level data from Coinglass reveals severe concentration:
Hyperliquid: $10.3 billion liquidated, with $1.23 billion in trader equity wiped out and 6,300 wallets completely eliminated
Bybit: $4.65 billion liquidated
Binance: $2.41 billion liquidated
Of the $19.1 billion total, $16.7 billion came from long positions (87.4%), reflecting extreme bullish positioning prior to the crash. Over 1.6 million individual traders were liquidated.
Winners in the Wreckage: Counter-Trend Profits
While nearly everyone lost their money, few made fortunes. Several whales capitalized on the rebound :
Wallet 0xe9d: Closed a BTC long for $265,000 profit overnight
Wallet 0x728: Built ETH and SOL longs with $1.56 million unrealized gain
World Liberty Financial advisor: Opened a 20x long on 125.7 BTC ($14.3 million), later adding 3x long on 850,000 ASTER ($1.25 million)
Wallet 0xb9fe: After losing $2 million in liquidations, reopened a 25x long on 18,960 ETH ($72.7 million), recovering losses plus $3.6 million profit
Pre-Positioned Whale Activity: Suspicious Timing
On-chain analytics identified highly suspicious whale activity (0xb317d2bc2d3d2df5fa441b5bae0ab9d8b07283ae) preceding the crash :
$1.1 billion short position: A whale opened more than $1.1 billion in combined Bitcoin and Ethereum short positions hours before Trump's tariff announcement.
$192-200 million profit: This trader closed 90% of positions immediately after the crash, securing estimated profits of $192-200 million in a single day.
Subsequent activity: The same wallet reopened a $163 million Bitcoin short on October 12, currently sitting at over $3 million unrealized profit.
The precision timing has sparked market manipulation investigations, with crypto attorney John Deaton publicly calling for regulatory scrutiny.
Hackers Panic Selling
During the market turmoil, unusual on-chain behavior was observed as several hacker wallets panic-sold ETH for DAI, later buying back at significantly higher prices, a rare case of emotional trading even among exploiters.
Market Recovery Metrics
By October 13, markets showed tentative stabilization :
Bitcoin: Recovered to $114,000-115,000 (11.8% rebound from lows)
Ethereum: Climbed back above $4,100 (14.7% recovery)
24-hour liquidations: $620 million on October 13, with a 34-66 split favoring short liquidations, a complete sentiment reversal
Volume surge: Total 24-hour volume jumped 26.8%, suggesting re-entry by previously liquidated traders
Bitcoin dominance: Rose to 58.45%, indicating capital flight to large-cap safety
Infrastructure Failures: What This Event Exposed
Leverage saturation: Pre-crash Bitcoin open interest exceeded $50 billion, indicating dangerously crowded long positioning
Weekend liquidity vacuum: The crash occurred after U.S. markets closed on Friday, removing institutional liquidity buffers
Cross-margin contagion: Centralized exchanges' auto-liquidation of cross-margined collateral amplified altcoin selloffs
No circuit breakers: Unlike traditional markets with coordinated halt mechanisms at 7%, 13%, and 20% thresholds, crypto exchanges operate independent risk engines with no systemic safeguards
Bottom Line
The October 10 liquidation event represents not merely a price correction but a market integrity stress test that revealed asymmetric information exploitation, infrastructure fragmentation, and the absence of coordinated risk controls across the trillion-dollar crypto ecosystem.
Written by: Tushar Tiwari, Blockchain Forensics Analyst @ Blockscope
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Disclaimer: Best Effort Work
This article reflects our best-effort analysis based on information available as of publication. Please note:
Data limitations: Sources may be incomplete and the dataset can contain inaccuracies, omissions, or errors.
Subject to change: New or updated evidence may emerge that could materially alter parts of this report.
Interpretive nature: Findings and conclusions are based on our current understanding and may evolve over time.
No guarantees: While we’ve taken reasonable steps to ensure accuracy, we cannot guarantee that all information is fully correct or complete.
This document should be treated as a snapshot of knowledge at the time of writing and may be revised if reliable new information becomes available.
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