Ethereum’s $10B Leverage Purge Sets Stage for Epic Rebound - Here’s the Critical Catalyst

The great Ethereum leverage flush just hit $10 billion - and that's either a massive warning sign or the perfect setup for a monster rally.

Liquidation Cascade Creates Clean Slate

When over-leveraged positions get wiped out, it removes weak hands from the market. That $10 billion evaporation represents forced selling that's now behind us. The question isn't whether the flush happened - it's what comes next.

The IF That Changes Everything

Market rebounds need catalysts, not just oversold conditions. For Ethereum to launch its monster move, we need institutional flows returning, ETF volumes picking up, or major protocol upgrades delivering real utility. Because let's be honest - in crypto, fundamentals sometimes matter less than which whale decides to buy the dip.

Timing the Turnaround

History shows these leverage flushes often precede major moves. The market hates uncertainty more than it hates bad news - and once the forced selling ends, the path of least resistance becomes clearer. Though if you're waiting for traditional finance types to understand this, you might be retired before they figure it out.

Key Takeaways

Why is Ethereum’s recent price action significant?

ETH’s $10 billion Open Interest purge triggered leverage reset and renewed whale accumulation, hinting at a rebound.

How is BMNR influencing the market?

BMNR’s aggressive accumulation acts as a key catalyst, cutting through FUD, triggering FOMO, and signaling a potential inflection point.

Historically, when ethereum [ETH] dumps harder than Bitcoin [BTC], it usually bounces back harder too. In the recent case, between the 13th and the 25th of September, ETH tanked 18% while BTC only lost 7%.

Two weeks later, ETH ripped 14% versus BTC’s 10%. The culprit (or hero) here is the Derivatives market.

That trend returned this week. Ethereum saw a $10 billion Open Interest (OI) wipeout, nearly 2x Bitcoin’s deleveraging.

In short, big OI swings directly drive ethereum price action. It’s more levered, so drawdowns hit harder, just like after the recent crash, where ETH dropped 12.18% vs. BTC’s 5.82%, reinforcing the pattern.

Source: TradingView (ETH/USDT)

Largest Open Interest purge ever

Backing this, Ethereum faced its largest Open Interest (OI) purge ever.

CryptoQuant data showed that on the 10th of October (just within 24 hours after TRUMP imposed tariffs on China), ETH’s OI plunged from $28 billion to $19 billion, marking a record single-day drop.

Source: CryptoQuant

Normally, purges like this take about two weeks; ETH did it in one.

That’s massive deleveraging, though analysts said it was “long overdue,” as it clears the path for smart money to step in and “buy the fear.”

BMNR buys Ethereum as Tom Lee calls dip ‘healthy shakeout’

On that note, BitMine’s [BMNR] conviction in Ethereum remained rock-solid.

Lookonchain data showed BMNR scooped 128,718 ETH for $480 million after the recent crash, putting their average cost basis at $3,730 per ETH.  That’s in line with Tom Lee calling this pullback a “buying opportunity.”

So clearly, BMNR is running that playbook to the letter.

The result? ETH jumped 2.27% intraday, clawing back losses from the previous day, with bids stacking up as it retraced to early-August levels.

Source: TradingView (ETH/USDT)

In short, Ethereum looks set to replay its historical patterns.

Backing this trend, the ETH/BTC ratio was up 1.24% intraday, showing ETH flexing against BTC. This could be an early sign that the market might be bracing for a harder rebound, with the OI dump reinforcing the move.

In this context, BMNR’s conviction goes beyond simply absorbing pressure.

It acts as a key catalyst, bringing FOMO back and cutting through FUD, indicating that ETH could be at a key inflection point for investors to watch.