{"id":54233,"date":"2025-10-15T15:00:49","date_gmt":"2025-10-15T12:00:49","guid":{"rendered":"https:\/\/coinengineer.net\/blog\/?p=54233"},"modified":"2025-10-15T14:39:46","modified_gmt":"2025-10-15T11:39:46","slug":"bitwise-crypto-crash-bitcoin","status":"publish","type":"post","link":"https:\/\/coinengineer.net\/blog\/bitwise-crypto-crash-bitcoin\/","title":{"rendered":"Bitwise CIO Explains the Cause of Crypto Crash"},"content":{"rendered":"<p data-start=\"403\" data-end=\"637\"><strong>Bitwise<\/strong> CIO Matt Hougan explained that last week\u2019s record $20 billion <strong><a href=\"https:\/\/coinengineer.net\/blog\/crypto-falling-us-china-tension\/\">crypto<\/a> liquidation<\/strong> was not caused by fundamental issues. Hougan emphasized that the sudden crash was triggered by leveraged positions, not institutional failures.<\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_71 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/coinengineer.net\/blog\/bitwise-crypto-crash-bitcoin\/#Leverage_and_Market_Reaction\" title=\"Leverage and Market Reaction\">Leverage and Market Reaction<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/coinengineer.net\/blog\/bitwise-crypto-crash-bitcoin\/#Technology_and_Blockchain_Resilience\" title=\"Technology and Blockchain Resilience\">Technology and Blockchain Resilience<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/coinengineer.net\/blog\/bitwise-crypto-crash-bitcoin\/#Investor_Response_and_Market_Confidence\" title=\"Investor Response and Market Confidence\">Investor Response and Market Confidence<\/a><ul class='ez-toc-list-level-3' ><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/coinengineer.net\/blog\/bitwise-crypto-crash-bitcoin\/#Short-Term_Expectations\" title=\"Short-Term Expectations\">Short-Term Expectations<\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<h2 data-start=\"639\" data-end=\"672\"><span class=\"ez-toc-section\" id=\"Leverage_and_Market_Reaction\"><\/span>Leverage and Market Reaction<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p data-start=\"674\" data-end=\"1309\">The crypto market panic started after former President Trump announced a surprise trade threat against China. Following Trump\u2019s claim on Truth Social about imposing 100% tariffs on all Chinese imports in response to potential rare earth metal export restrictions, investors reacted in crypto markets. Bitcoin dropped as leveraged positions triggered at least $20 billion in liquidations. Ethereum fell over 20%, and Solana lost more than 40%. By Monday morning, Bitcoin rebounded to around $115,000 as Trump attempted to ease tensions. Hougan noted, \u201cNothing in the fundamentals changed,\u201d explaining why the market recovered quickly.<\/p>\n<h2 data-start=\"1311\" data-end=\"1352\"><span class=\"ez-toc-section\" id=\"Technology_and_Blockchain_Resilience\"><\/span>Technology and Blockchain Resilience<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p data-start=\"1354\" data-end=\"1766\">Hougan highlighted that blockchain systems performed well under stress. Decentralized platforms like Uniswap, Hyperliquid, and Aave operated smoothly. Centralized platforms faced some issues: Binance had to refund $283 million after depegging events and later launched a $400 million \u201crescue\u201d initiative. Overall, Hougan argued that crypto systems managed volatility as well or better than traditional markets.<\/p>\n<h2 data-start=\"1768\" data-end=\"1812\"><span class=\"ez-toc-section\" id=\"Investor_Response_and_Market_Confidence\"><\/span>Investor Response and Market Confidence<span class=\"ez-toc-section-end\"><\/span><\/h2>\n<p data-start=\"1814\" data-end=\"2163\">Losses were mostly limited to individual investors, according to Hougan. Major professional investors remained largely unaffected, showing that long-term confidence was not shaken. He emphasized that the crypto market\u2019s long-term growth drivers\u2014regulatory progress, institutional adoption, and ongoing traditional market disruptions\u2014remain intact.<\/p>\n<h3 data-start=\"2165\" data-end=\"2194\"><span class=\"ez-toc-section\" id=\"Short-Term_Expectations\"><\/span>Short-Term Expectations<span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul data-start=\"2196\" data-end=\"2411\">\n<li data-start=\"2196\" data-end=\"2285\">\n<p data-start=\"2198\" data-end=\"2285\">Market makers and liquidity providers may temporarily withdraw after high volatility.<\/p>\n<\/li>\n<li data-start=\"2286\" data-end=\"2341\">\n<p data-start=\"2288\" data-end=\"2341\">Liquidity gaps can amplify short-term price swings.<\/p>\n<\/li>\n<li data-start=\"2342\" data-end=\"2411\">\n<p data-start=\"2344\" data-end=\"2411\">Over time, the market will stabilize and refocus on fundamentals.<\/p>\n<\/li>\n<\/ul>\n<p data-start=\"2413\" data-end=\"2527\">Hougan concluded that crypto assets are fundamentally strong, and the bull market is expected to resume quickly.<\/p>\n<p data-start=\"2413\" data-end=\"2527\"><em>You can also freely share your thoughts and comments about the topic in the comment section. Additionally, don\u2019t forget to follow us on our\u00a0<a href=\"https:\/\/t.me\/coinengineernews\" target=\"_blank\" rel=\"noreferrer noopener\">Telegram<\/a>,\u00a0<a href=\"https:\/\/www.youtube.com\/@CoinEngineer\" target=\"_blank\" rel=\"noreferrer noopener\">YouTube<\/a>\u00a0and\u00a0<a href=\"https:\/\/twitter.com\/coinengineers\">Twitter<\/a>\u00a0channels for the latest news and updates.<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Bitwise CIO Matt Hougan explained that last week\u2019s record $20 billion crypto liquidation was not caused by fundamental issues. Hougan emphasized that the sudden crash was triggered by leveraged positions, not institutional failures. Leverage and Market Reaction The crypto market panic started after former President Trump announced a surprise trade threat against China. Following Trump\u2019s<\/p>\n","protected":false},"author":36,"featured_media":36969,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[657,2],"tags":[11409,24798,192,24800,11199,12898,24801,24799,24797],"class_list":["post-54233","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-en","category-news","tag-bitcoin-drop","tag-bitwise-analysis","tag-blockchain","tag-centralized-platform","tag-crypto-crash","tag-ethereum-liquidation","tag-investor-response","tag-leverage-position","tag-solana-loss"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v22.6 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>Bitwise CIO Explains the Cause of Crypto Crash - Coin Engineer<\/title>\n<meta name=\"description\" content=\"Bitwise CIO Matt Hougan says crypto crash is temporary; Bitcoin, Ethereum and Solana recover quickly as fundamentals stay strong.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/coinengineer.net\/blog\/bitwise-crypto-crash-bitcoin\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Bitwise CIO Explains the Cause of Crypto Crash - Coin Engineer\" \/>\n<meta property=\"og:description\" content=\"Bitwise CIO Matt Hougan says crypto crash is temporary; 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