On the afternoon of October 17, the cryptocurrency market once again staged a "high diving" event. Bitcoin fell below the $106,000 mark, Ethereum dropped below $3,800, and SOL fell below $180, with the overall market capitalization evaporating over $12 billion in a single day. This big dump occurred just a week after the "Black Friday" on October 10, when the market recorded a historical liquidation of $19.2 billion. In just a few days, investors in the crypto space seemed to be on a runaway roller coaster.


The culprit of the big dump, the truth emerges.
On the surface, the "big dump" in the US credit market is the trigger for this plummet. As risk aversion increased, the price of gold skyrocketed to over $4,380 per ounce, while cryptocurrencies like Bitcoin were heavily sold off. However, the truth is far from simple.
JPMorgan analysts have pointed out that this pullback is mainly driven by native cryptocurrency investors, rather than institutional or retail ETF holders. In other words, insiders in the crypto circle are quietly withdrawing. Data confirms this judgment: On October 16, there was a total net outflow of $536 million from Bitcoin spot ETFs, with none of the 12 ETFs achieving net inflow. Institutional funds are quietly withdrawing, while ordinary investors are still immersed in the illusion of bottom fishing.
Leverage trading, hidden deadly traps
The high leverage trading remains the culprit behind this wave of liquidation.
In the cryptocurrency market, many investors do not use their spare money to invest, but rather borrow money to leverage, hoping to get rich overnight. However, leveraged trading is a double-edged sword: as soon as the price falls by 10%, the principal instantly goes to zero, which is called "liquidation". This trading mechanism makes the market extremely fragile. Once the price starts to drop, forced liquidations can trigger a chain reaction, forming a death loop of "downward → liquidation → sell-off → further decline". The big dump on October 10th is a typical case: at that time, the leverage of long positions was too high, and the price drop triggered a large number of forced liquidations, ultimately leading to a record liquidation of $19.2 billion.

History repeats itself, the alarm bell rings on.
This is not the first painful lesson the crypto world has experienced, and it probably won't be the last. On October 10, the market just went through an "epic big dump." Bitcoin plummeted from a high of $122,000 to $101,500, with a single day liquidation amount reaching $19.2 billion and over 1.64 million people liquidated. The trigger for that big dump was Trump's tariff threat posted on social media, where he claimed to impose an additional 100% tariff on goods from China. Combined with the U.S. federal government "shutdown" and the Federal Reserve's "cautious interest rate cut" signals, the threefold negative factors collectively ignited this disaster in the crypto world.
History is always surprisingly similar: every time before a market crash, investors are immersed in excessive optimism. Just a few days before the big dump, Bitcoin had just reached an all-time high of $126,000, and the market was in a frenzy.

Where will the future lead?
In the face of market fluctuations, analysts have significantly divergent views on the future market.
Matthew Hougan, Chief Investment Officer of Bitwise, stated, "Cryptocurrency is like the canary in the coal mine, signaling that the market is walking on thin ice due to emerging credit concerns." This perspective suggests that cryptocurrencies have become a leading indicator of market risk appetite.
BTC Markets analyst Rachael Lucas pointed out the key technical level: "$107,000 is seen as a key support level for Bitcoin. If it clearly breaks below this level, it may trigger a deeper decline." However, not all institutions hold a pessimistic view on this round of adjustments.
Deutsche Bank believes that against the backdrop of accelerating de-dollarization and a surge in demand for safe-haven assets, by 2030, Bitcoin and gold may become important components of central bank reserve assets. Bitwise even predicts that by 2035, the price of Bitcoin could reach $1.3 million, with a compound annual growth rate of 28.3% over the next decade.
But it must be reminded to all investors:
In the volatile cryptocurrency market, surviving is more important than making quick money. Refuse high leverage. Most of the liquidated traders this time were short-term investors who used more than 5x leverage. High returns come with high risks, and leverage is a double-edged sword.
Pay close attention to key market signals.
The Federal Reserve's policies, the progress of the U.S. government shutdown, and the flow of ETF funds are key factors influencing the cryptocurrency market. Investors can use tools like Coinglass to monitor liquidation data in real-time and prepare risk warnings in advance.
Decentralized allocation is an immutable truth.
Don't put all your eggs in one basket, avoid investing all your funds in cryptocurrency, and be wary of the "get rich quick" trap.
The market will always have opportunities, but the premise is that you must survive the storm. An experienced player revealed the survival rule in the crypto world: "It's not about who earns more in the crypto world, but rather who lasts longer."
BTC0.76%
ETH2.13%
SOL2.46%
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Ybaservip
· 4h ago
1000x Vibes 🤑
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ShiFangXiCai7268vip
· 9h ago
Hold on tight, we are about to To da moon🛫
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Asiftahsinvip
· 11h ago
HODL Tight 💪
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Aerobicvip
· 13h ago
Quick, enter a position! 🚗
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WinTheWorldWithWisdovip
· 13h ago
Steadfast HODL💎
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Discoveryvip
· 14h ago
Watching Closely 🔍
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BigHead494vip
· 10-18 11:06
Watching Closely 🔍
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Szerovip
· 10-18 07:03
HODL Tight 💪
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Sakura_3434vip
· 10-18 06:26
Just go for it💪
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Lock_433vip
· 10-18 06:05
Just Go for it 💪
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