{"id":56330,"date":"2025-11-03T12:31:37","date_gmt":"2025-11-03T12:31:37","guid":{"rendered":"https:\/\/dogewisperer.com\/?p=56330"},"modified":"2025-11-03T12:31:37","modified_gmt":"2025-11-03T12:31:37","slug":"octobers-crypto-flash-crash-did-market-makers-make-it-worse","status":"publish","type":"post","link":"https:\/\/dogewisperer.com\/?p=56330","title":{"rendered":"October&#8217;s Crypto Flash Crash: Did Market Makers Make It Worse?"},"content":{"rendered":"<div>\n<h1 class=\"wp-block-heading\">Snapshot:<\/h1>\n<ul class=\"wp-block-list\">\n<li>Bitcoin&#8217;s October 10 plunge exposed how fast crypto liquidity can vanish when trading algorithms sound the red alert. The resulting liquidation cascade turned a macro jolt into a free fall.<\/li>\n<li>Market makers weren&#8217;t malicious, just risk-averse, but their simultaneous pullback revealed a systemic flaw: everyone&#8217;s code panics the same way.<\/li>\n<\/ul>\n<h2 class=\"wp-block-heading\">When the Bids Vanished<\/h2>\n<p>On October 10, the crypto market went off-script. A White House tariff announcement on Chinese imports hit the wires; minutes later Bitcoin plunged more than 10%. What began as a macro wobble turned into a flash crash that briefly erased tens of billions in value \u2013 and exposed how thin crypto markets can be when volatility strikes.<\/p>\n<p>Data from <a href=\"https:\/\/research.kaiko.com\/insights\/when-october-surprise-meets-crypto-liquidity-drought\" rel=\"nofollow\">Kaiko<\/a> show that order books &#8220;appeared empty&#8221; as sell orders sliced through bids across exchanges. Bitcoin fell toward $106,000 before stabilizing. The spark was obvious: tariffs. The violent reaction wasn&#8217;t.<\/p>\n<h2 class=\"wp-block-heading\">A Liquidity Void<\/h2>\n<p>Kaiko&#8217;s data paint a clear picture: bid-side liquidity in BTC-USDT pairs sank to multi-month lows. Spreads blew out, and even the largest venues looked ghosted.<\/p>\n<p>Galaxy Digital\u2019s analyst desk <a href=\"https:\/\/www.galaxy.com\/insights\/research\/cryptos-flash-crash-liquidation-binance-adl-auto-deleveraging\" rel=\"nofollow\">summed it up bluntly<\/a>: \u2018High leverage, thin depth, one headline.\u2019 Open interest was rich, risk appetite high, and once the shock hit, volatility spiked, hedging demand surged, and automated deleveraging kicked in.<\/p>\n<p>Seconds before the plunge, spreads widened \u2013 suggesting algo &#8230;<\/p>\n<p><a href=\"https:\/\/www.benzinga.com\/Opinion\/25\/11\/48586856\/octobers-crypto-flash-crash-did-market-makers-make-it-worse?utm_source=benzinga_taxonomy&amp;utm_medium=rss_feed_free&amp;utm_content=taxonomy_rss&amp;utm_campaign=channel\" alt=\"October's\" crypto flash crash: did market makers make it worse>Full story available on Benzinga.com<\/a><\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"<p>Snapshot: Bitcoin&#8217;s October 10 plunge exposed how fast crypto liquidity can vanish when trading algorithms sound the red alert. The resulting liquidation cascade turned a macro jolt into a free fall. Market makers weren&#8217;t malicious, just risk-averse, but their simultaneous pullback revealed a systemic flaw: everyone&#8217;s code panics the same way. When the Bids Vanished [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"iawp_total_views":0,"footnotes":""},"categories":[2],"tags":[3,4,5],"class_list":["post-56330","post","type-post","status-publish","format-standard","hentry","category-news","tag-crypto","tag-doge","tag-news"],"_links":{"self":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts\/56330","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=56330"}],"version-history":[{"count":0,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=\/wp\/v2\/posts\/56330\/revisions"}],"wp:attachment":[{"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=56330"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=56330"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dogewisperer.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=56330"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}