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After a bruising week for markets, the weekend delivered a full-blown crypto washout.

Bitcoin slid relentlessly through thin weekend liquidity, briefly dipping into the low $74,000s before clawing its way back toward $76,000. Ether saw even heavier damage, falling below $2,200 at one point, while most large-cap altcoins followed lower. 

With traditional markets closed and institutional desks sidelined, shallow order books amplified every move, turning sell pressure into sharp air pockets.

The liquidation tally tells the story. More than $2.5 billion in leveraged long positions were wiped out as clustered stops triggered one after another. QCP Capital noted that the break below $80,000 reignited deleveraging at a time when sentiment was already fragile from persistent ETF outflows and tighter financial conditions.

One psychological level didn’t hold. Bitcoin’s drop pushed it below the average cost basis of Michael Saylor’s Strategy, which sits near $76,000. For the first time in years, that widely watched line flipped from perceived support into resistance. 

While Strategy faces no margin calls and isn’t forced to sell, the breach highlights how much thinner the buffer has become as its equity premium evaporates.

“Price action remains fragile. Momentum continues to point lower and upside remains constrained near recent resistance levels, leaving markets exposed to further liquidation-driven moves. In this context, selectively managing downside risk remains prudent,” QCP wrote.

Crypto Twitter lit up this weekend as old wounds reopened over what actually caused the October 10 liquidation cascade, one of the most violent crashes the market has ever seen.

The spark came from OKX CEO Star Xu, who argued that the crash stemmed from Binance’s handling of USDe, a yield-bearing token issued by Ethena. Xu said a high-APY campaign, combined with allowing USDe to be used as collateral like USDT or USDC, encouraged leverage loops that quietly built systemic risk. When volatility hit, he argued, USDe briefly lost its peg on Binance, setting off cascading liquidations that rippled across the market.

That framing was quickly challenged. Dragonfly’s managing partner Haseeb Qureshi pushed back hard, calling the Binance-centric explanation misleading. His core point: the timeline doesn’t fit. Bitcoin had already sold off and liquidations were underway well before USDe showed stress on Binance. 

Just as importantly, USDe only diverged on one venue. A truly systemic trigger, Qureshi argued, would have shown up everywhere, as seen in events like Terra or FTX.

Adding weight to that view, Wintermute CEO Evgeny Gaevoy also rejected the idea that Binance was the root cause. He described October 10 as a macro-driven flash crash in an extremely leveraged market, made worse by thin liquidity, API outages, and liquidation engines that prioritize solvency over stability.