Crypto Market Cap Drops $1.2 Trillion in Eight Weeks – Was This Reset Needed?
The cryptocurrency market witnessed a dramatic deleveraging event over eight weeks, shedding $1.2 trillion in value as global market capitalization plummeted from $4.6 trillion to $3.4 trillion. Analyst Shanaka Perera dubbed it an execution rather than a crash—a technical wipeout where excessive leverage met insufficient liquidity.
On October 10, $19 billion in Leveraged positions were liquidated within 24 hours, with nearly 487,000 traders wiped out daily. Record open interest of $217 billion in futures contracts collided with spot liquidity at just 5% of normal levels, triggering a vicious cycle of margin calls and forced selling. By month-end, open interest collapsed 43% to $123 billion—one of the fastest market resets in years.
Paradoxically, while prices cratered, crypto adoption and on-chain activity surged to record highs. The fundamentals tell a story of resilience beneath the turbulence.
