Bitcoin Crashes for a Month! What Really Happened Behind the October 10 Liquidation Drama?
Bitcoin’s 25% One-Month Crash: What Really Happened After the October 10 Liquidation Shock?
Bitcoin is facing one of the most difficult months in its modern history. What began as a single-day market disruption on October 10 has now spiraled into a sustained, month-long decline that wiped out nearly a quarter of the asset’s value. From its peak at $127,000, the world’s largest cryptocurrency plunged to $82,000, triggering widespread fear, confusion, and intense debate among analysts and traders.
For many in the industry, the question goes far beyond daily price movements: What happened on October 10 that forced Bitcoin into its worst monthly performance in years?
The answer, according to market data and several top analysts, points to a catastrophic and unprecedented $19 billion forced liquidation event—a structural market shock that continues to influence liquidity and market psychology even a month later.
A Single Day That Broke the Market: The October 10 Liquidation Explained
October 10 may now be remembered as one of the most destabilizing days in crypto market history. On that day, nearly $19 billion in positions were liquidated across major centralized exchanges, sparking a sudden and violent collapse in market structure.
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| Source: The Bitcoin Therapist X Account |
While liquidations are common in crypto, analysts insist that this was something entirely different.
According to interviews and exchange data:
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Liquidity evaporated across multiple major trading pairs.
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Market makers suffered massive drawdowns.
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Auto De-Leverage (ADL) systems activated at scale, closing positions before traders could react.
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Insurance funds on several exchanges became overloaded.
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Perpetual contracts malfunctioned due to internal exchange glitches.
Veteran strategist Tom Lee told CNBC that the October 10 disruption “broke the market,” highlighting how the liquidity shock turned into a structural failure rather than a typical sell-off. Data compiled from several trading dashboards supports this explanation.
The result was immediate—and catastrophic. Bitcoin’s trend reversed overnight, and what appeared to be a short-lived dip turned into a month of relentless declines.
A Month of Bleeding: How Bitcoin Lost 25% After October 10
Prior to the breakdown, Bitcoin was trading confidently between $110,000 and $115,000, showing strong bullish momentum after hitting a historic all-time high of $127,000. But the crash on October 10 marked the beginning of a new trend:
Technical indicators showed a complete structural shift:
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Lower highs and lower lows formed continuously for weeks.
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The RSI collapsed into the oversold range (20–30), a rare occurrence for an asset of Bitcoin’s scale.
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MACD remained bearish for nearly the entire month.
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Liquidity fell to one of the lowest levels in recent years, making even small orders move the price dramatically.
This raised a troubling question among investors while the decline continued:
Why was Bitcoin—once considered digital gold—behaving like a low-cap altcoin?
As analysts noted, the market simply never recovered from the liquidity void caused by the liquidation event. Without enough buyers, every downward movement created a stronger cascade.
From $127K to $82K: Understanding How Low Bitcoin Can Fall
The market shock rippled far beyond Bitcoin. According to data from analytics dashboards:
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| Source: coinglass |
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Over $2.01 billion in leveraged positions were liquidated within 24 hours.
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More than 400,000 traders lost positions.
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Major altcoins including ETH, SOL, AVAX, and others also turned sharply red.
This reinforced the suspicion that the October 10 event was not just a one-day anomaly but the beginning of a broader structural correction.
By November, Bitcoin touched a low of $82,000, representing an almost 35% decline from its record high earlier in the cycle.
Despite the drop, analysts emphasize that the asset is now extremely oversold.
RSI remains at historically low levels, and the MACD signals weakening selling pressure, which typically precedes a potential recovery.
Price Prediction: Where Bitcoin Might Head Next
With volatility still high and investor sentiment fragile, Bitcoin’s next move is expected to be critical for the overall crypto market. Analysts have outlined three main scenarios based on short-term, mid-term, and long-term outlooks.
Short-Term Outlook: Retesting $80,000
In the immediate period, Bitcoin could test the $80,000–$81,000 support zone once again. Analysts believe shorts may begin taking profits near this level, potentially triggering a short-lived bounce.
A relief rally to around $88,000 remains likely if selling pressure continues to weaken.
Medium-Term Outlook: Gradual Recovery Toward $97,000
If Bitcoin holds above the essential $80,000 support band, a slow recovery could develop over the next several weeks.
The next key resistance sits around $97,000, and breaching this level would be the first sign of a structural trend reversal.
However, the path upward may be challenging. Many traders who bought at higher prices are likely to sell during upward bounces to minimize losses, creating turbulence on the way up.
Long-Term Outlook: Conditions for a Return to $100,000
For Bitcoin to return to six-figure ranges, analysts agree that several macroeconomic and structural conditions must align, including:
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Federal Reserve interest rate cuts
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Renewed ETF inflows
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Progress on the proposed U.S. Strategic Bitcoin Reserve bill
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Stabilization of exchange liquidity
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A reduction in leveraged positions
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Institutional accumulation
If these factors converge, Bitcoin could realistically attempt a move back toward $100,000 later in the market cycle.
However, this scenario depends heavily on external catalysts and market stabilization.
What Made the October 10 Crash So Different?
While Bitcoin has experienced sharp drops in the past, the October 10 crash stands out for several reasons:
1. It Was a Forced Liquidation Event
Unlike normal price corrections, the October 10 crash originated from forced selling. This creates market movements that are mechanical, not sentiment-driven.
2. It Damaged Market Structure
Liquidity pools vanished, spreads widened, and market depth collapsed. This has long-term implications, even after prices stop falling.
3. It Broke Price Discovery
When major perpetual markets glitched, price discovery became distorted. Traders lost confidence in exchange stability.
4. It Affected Institutional Flows
Large-scale investors paused or reduced accumulation until the market stabilizes.
5. Retail Panic Strengthened the Downtrend
Continuous declines triggered fear-based selling among newcomers and casual traders.
Taken together, these factors created a self-reinforcing cycle that pushed Bitcoin into its worst monthly performance in years.
Investor Sentiment: Fear, Confusion, and Cautious Optimism
Sentiment metrics show extreme fear in the market. Funding rates continue to stay negative, indicating that traders are willing to pay to keep short positions open.
Yet many long-term investors remain cautiously optimistic, citing Bitcoin’s historical pattern of recovering after deep corrections. In past cycles, BTC has frequently rebounded from 30–40% drawdowns before setting new highs months later.
Institutional analysts also argue that the long-term fundamentals of Bitcoin remain intact despite short-term structural issues.
Conclusion: A Crash That Shook the System, but Not the Future
The Bitcoin crash triggered by the $19 billion October 10 liquidation has become one of the most consequential market events in cryptocurrency history. The event disrupted liquidity, damaged exchange infrastructure, and triggered a prolonged decline that left traders searching for answers.
But while the market remains fragile, history shows that Bitcoin has repeatedly recovered from periods of extreme volatility and fear.
For now, the levels to watch closely are:
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$80,000 – Critical Support
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$90,000 – Major Resistance
The coming weeks will determine whether Bitcoin begins its path to recovery or faces deeper structural correction.
Either way, the October 10 event will likely be studied for years to come—a reminder of how quickly the crypto market can shift, and how vulnerable even the strongest assets remain in the face of liquidity shocks.
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