In just a few hours, over $120 billion vanished from the crypto market. Bitcoin, Ethereum, Solana - no asset was spared. According to a World LibertyFi advisor, it's not just a "technical dump" but a storm orchestrated by leverages, liquidation, and institutional strategies. Discover the true story behind the October 10 crash.
According to Ogle, looking for a single trigger would be a fundamental analytical error. “You don’t die from heart disease simply because you ate too many burgers,” he explains pragmatically. “It’s a thousand things coming together that cause disasters.” This systemic view of the crypto crash highlights three main factors that combined explosively.
First, liquidity gaps played a decisive role. During the fall, order books emptied at an alarming rate. Bid levels literally evaporated, leaving price action to fall into the void. Even at significantly reduced price levels, buyers remained absent from the market.
Next, excessive leverage on professional exchanges amplified the movement. Many traders were using cross margin, a system that links all positions together. When one position begins to liquidate, the domino effect becomes inevitable. “It’s a cascade – if one position collapses, everything collapses with it,” emphasizes Ogle.
Finally, Donald Trump’s statements regarding US-China relations triggered a chain reaction in algorithmic trading systems. These bots interpreted these macroeconomic signals as a sell signal, generating a wave of automatic short positions that accelerated the descent.
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Faced with this damning assessment, Ogle insists on a crucial recommendation for all traders using perpetual contracts: “If you remember just one thing from this podcast and you want to trade perpetuals, you must use isolated margin.”
The difference between these two margin types is fundamental for risk management. Isolated margin limits potential losses to the specific position you’re trading. If the market moves against you and your position gets liquidated, only the capital allocated to that particular position is lost. The rest of your account remains intact.
In contrast, cross margin uses your entire account balance as collateral for all your open positions. This approach might seem advantageous during calm periods, as it reduces the risk of immediate liquidation. But during high-volatility events like October 10th, it becomes a genuine trap. A single position gone wrong can trigger a total liquidation of your account, even if your other trades are profitable.
Beyond the technical trading questions, the October 10th crash revives the fundamental debate on cryptocurrency custody. Ogle openly criticizes the persistent dependence of the community on centralized exchanges, despite the repeated failures the industry has experienced.
Examples abound: Celsius, FTX, and numerous other incidents have demonstrated the inherent risks of centralization. Yet traders continue to massively use these platforms, attracted by their superior liquidity and user-friendly interface.
The expert also points to a deeper cultural problem in the crypto space: the casino mentality that transforms investment into pure speculation. The frenzy around memecoins and the obsessive pursuit of 100x gains resembles the California gold rush of the 19th century. This approach harms the overall credibility of the sector and drives away institutional investors who could bring stability and maturity to the market.
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