- Sebastjan Bele
- Updated: October 16, 2025
- Reading time: 6 min
Record Liquidations, Gold Pumping & Binance Listing Fees Debate
On Friday, October 10, markets experienced the largest liquidation event on record after the U.S. announced 100% tariffs on all Chinese imports starting November 1, triggering a broad flight to safety. The S&P 500 fell 2.9%, the VIX spiked from 16 to 22, and 10-year yields dropped from 4.14% to 4.05%, while gold surged as investors rotated defensively. Within hours, the crypto market saw over $19 billion in leveraged positions liquidated, the largest single-day wipeout in history. At the moment Bitcoin is trading at $110K and Ethereum at $4,000.
In other developments, Limitless CEO CJ Hetherington posted Binance’s listing offer, reigniting debate over exchange listing fees, while Binance paid out $283 million in compensation to cover user losses following Friday’s depegs. Polymarket expanded into up/down equity markets, allowing users to bet on stock price movements, and the U.S. government’s Bitcoin holdings rose to $36 billion after a record DOJ seizure, underscoring its growing on-chain presence.
News
- Bitcoin, Ethereum, Dogecoin Down as Record $19 Billion in Crypto Liquidations Hit Markets
- Binance Pays $283 Million in Compensation Following Friday’s Depegs, Covering User Losses
- US Government Bitcoin Holdings Balloon to $36 Billion Following Record-Breaking DOJ Seizure
- Metaplanet’s mNAV Falls Below 1 as Bitcoin-Heavy Balance Sheet Faces Pressure
- Binance Claims It Does Not Profit From Token Listings, Calls Allegations ‘False and Defamatory’
- Polymarket Launches Up/Down Equity Markets Letting Users Bet on Stock Prices
- Bitmine Adds $417 Million in Ethereum Holdings
- Paxos Mistakenly Mints 300 Trillion Tokens
- Coinbase Adds BNB to Listing Roadmap Amid Industry Spat Over Listing Fees
- Binance Fires Back at ‘Fudders’ Over Claims of $20 Billion in Weekly Outflows
Table of Contents
Markets
Best Performers
Dash (DASH) and Zcash (ZEC) led the pack, gaining +59% and +36% respectively, as privacy-focused assets regained momentum amid rising regulatory debates and renewed investor interest.
Bittensor (TAO) climbed +20% following Grayscale’s October 10 filing with the U.S. SEC to launch a Bittensor Trust, giving institutions indirect exposure to the TAO token.
Morpho (MORPHO) rose +14.5% after the Ethereum Foundation committed $16 million to Morpho’s yield-bearing vaults, boosting confidence in DeFi lending innovation.
Tether Gold (XAUt) gained +4.9%, supported by the gold rally, as investors rotated into commodity-backed stablecoins amid global market uncertainty.
Sector Performance
According to GMCI, the GMCI 30, which tracks the top 30 cryptocurrencies, is down 10.49% over the past week. The GMCI Mid Cap and GMCI Small Cap indices also posted loss of 21.07% and 18.43%, respectively. The majority of sectors are down this week:
- Layer 1 down 10.02%
- Layer 2 up 25.18%
- DeFi down 17.10%
- AI down 14.81%
- RWA down 17.11%
- Gaming down 22.29%
- Meme down 19.48%
US Spot ETF Balances
US Bitcoin Spot ETFs
Total Assets Under Management (AUM) = $152,78 Billion
Weekly Inflows = – $10,16 Billion
US Ethereum Spot ETFs
Total Assets Under Management (AUM) = $24,94 Billion
Weekly Inflows = – $1,38Billion
*The data for BTC / ETH ETFs can vary, so we use Coinglass as our source.
Market Commentary
Bitcoin
During Friday’s crash, $BTC briefly dipped to the low $100Ks before bouncing back to $110K. Despite the largest crypto liquidation in history, Bitcoin has held relatively well, currently trading ~12.7% below its $126K all-time high.
Funding rates have reset, reducing excessive leverage and cooling down speculative positioning. We’ve now widened the trading range between $109K and $117K. Bitcoin is currently sitting near the range low, and price reaction at these levels will be key — failure to hold could open the door for a retest of $100K.
Ethereum
$ETH dropped to $3,500 during Friday’s sell-off but quickly recovered to $4,000, a level that continues to act as strong support. The RSI remains in decline, showing momentum cooling off, while open interest is falling in line with price, suggesting reduced speculative activity.
Similar to BTC, it’s a wait-and-see scenario — with ETH sitting at the range low, it could present a favorable risk-to-reward setup if support holds and market sentiment stabilizes.
Bitcoin dominance rose slightly to 58.8%, indicating continued rotation from altcoins into majors.
In traditional markets:
- S&P 500 down 0.65%
- NASDAQ down 0.65%
- Gold up 6.15%, extending its strong yearly performance
The total crypto market cap stands at $3.75T, down ~9.6% from last week’s $4.15T, reflecting the impact of recent liquidations and broader risk-off sentiment. The Fear & Greed Index dropped to 28 (Fear), signaling a sharp shift toward caution across the market.
What Happened?
In this special edition, we won’t discuss What’s Next — instead, we take a look back at what happened during Friday’s record crash.
The Friday market crash wasn’t primarily about fundamentals, but rather a leverage unwind. It’s likely that a large player was heavily leveraged in one direction — possibly shorting Bitcoin using a low-quality token as collateral. When the tariff headline hit, risk assets sold off, funding rates flipped, and over-levered perpetual positions across DEXs and CEXs were liquidated in a cascade.
During the crash, order books across major exchanges thinned sharply near the best bid and ask levels. With liquidity gone, even small sell orders caused outsized price drops. Only Binance, Kraken, and CryptoCom managed to maintain moderate depth (4–10%), cushioning the fall to some extent.
A major contributor to the rapid cascade was Auto-Deleveraging (ADL). While ADL is generally a reliable risk-control mechanism, acting as a last line of defense for exchanges, the issue during Friday’s crash was that on some venues, ADL triggered at unusual prices.
Why does this matter? Most market makers operate delta neutral, holding spot assets while hedging with perpetual shorts. When ADL triggers, those short hedges are forcefully closed, leaving the market maker unhedged and exposed. To restore balance, they must sell spot assets, which adds more sell pressure to an already falling market.
This creates a feedback loop — prices fall further, liquidity thins, and market imbalance deepens as buyers hesitate to step in.
These dynamics likely explain why liquidations cascaded so violently, draining liquidity across venues. Open interest has yet to recover, confirming that market participants remain defensive, waiting for stability to return before stepping back in.
Meme of the Week
We hope you enjoyed this week’s edition of Diary of a Market Maker! Stay tuned for more insights, updates, and market-moving highlights as we continue to keep you informed and entertained in the ever-evolving world of crypto.
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Until next time, happy trading and stay ahead of the curve!
Disclaimer: The information provided in this article is for informational purposes only and does not constitute financial, investment, or other professional advice. All opinions expressed herein are solely those of the author and do not represent the views or opinions of any entity with which the author may be associated. Investing in financial markets involves risk, including the potential loss of principal. Readers should perform their own research and consult with a licensed financial advisor before making any investment decisions. Past performance is not indicative of future results.
Jakob Brezigar
Jakob, an experienced specialist in the field of cryptocurrency market making, boasts an extensive international presence. With Orcabay, he has skillfully managed major operations and deals for a wide array of global stakeholders.
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