Tracking the "10.11 Flash Crash" in the Crypto Market and Its Future Impact

In the cryptocurrency field, holding positions and waiting is a slow financial suicide.

ChainCatcher news, according to Lookonchain statistics, after Tether Treasury minted 1 billion USDT on the Ethereum chain this morning, Tether and Circle have cumulatively minted 6 billion dollars in stablecoins since the flash crash on October 11.

ChainCatcher news, according to Bloomberg, the latest research report shows that retail investors attempting to indirectly invest in Bitcoin through digital asset holding companies like Metaplanet and Michael Saylor's Strategy have estimated losses of $17 billion. These losses primarily stem from excessive equity premiums, allowing these companies to issue stocks at prices far exceeding the actual value of their cryptocurrency holdings.Currently, the stock prices of these companies have completely collapsed, leaving many retail investors deeply trapped. "The era of financial magic for Bitcoin holding companies is coming to an end," wrote analysts from Singapore's 10X Research in a report released on Friday. The report titled "After the Magic: How Bitcoin Holding Companies Must Evolve Beyond the Illusion of Net Asset Value" pointed out that retail investors "have actually lost about $17 billion, while new shareholders paid an additional premium of about $20 billion for exposure to Bitcoin risk."Using Strategy as an example, the author noted that the company's stock price is currently only 1.4 times its Bitcoin holding value, a significant reduction from the previous premium levels of 3-4 times. The strategy of most Bitcoin holding companies is quite simple: issue stocks at a premium above net asset value and use the price difference to purchase Bitcoin, repeating this cycle.Researchers pointed out that Metaplanet's $1 billion investment in Bitcoin once skyrocketed its market value to $8 billion, which then fell to $3.1 billion, while its Bitcoin holding value is $3.3 billion. "In this process, shareholders lost $4.9 billion in market value, while the company successfully accumulated $2.3 billion in Bitcoin—this is a commendable 'feat'," the report stated.The report emphasizes that the compression between market value and stock price is a cause for concern. These companies now need to find new ways to survive. Researchers believe that Bitcoin holding companies must move away from the model of purchasing Bitcoin based on "inflated" net asset values and shift towards operations more akin to arbitrage-driven asset management firms. While this may reduce Bitcoin's upside potential, the ability to adapt to the new model will determine these companies' profit prospects.

Even Tom Lee has stated that the crypto treasury bubble may have burst.

ChainCatcher news, October 14, DeFiance Capital founder Arthur posted on social media, "We are fine, the fund has experienced some losses, but it does not rank among our top five days of profit and loss fluctuations. I am just very angry and disappointed; this crash has significantly regressed the entire crypto space, especially for the altcoin market, as most price discovery processes occur on offshore CEX."

ChainCatcher news, Tether CEO Paolo Ardoino posted on the X platform that USDT performed stably during the crypto market crash.He stated: "USDT is the best collateral for derivatives and margin trading, with good liquidity and market validation. If you use low liquidity tokens, some bananas, a horse, three olives, and a chewed piece of bubble gum as collateral, then be prepared when the market is volatile."

ChainCatcher news, according to a report by Wall Street Insight, "After the flash crash on October 11," the crypto market has begun to recover some of its losses, but the full impact of the event may take days or even weeks to fully manifest. Several industry insiders have shared their views:Edward Chin, CEO of the crypto hedge fund Parataxis, expressed skepticism that news of some funds facing liquidation or market makers suffering heavy losses will emerge in the coming days or weeks.Caroline Mauron, co-founder of Orbit Markets, pointed out that Bitcoin's next major support level is at $100,000, and falling below this level would mark the end of the bull market cycle of the past three years.Vincent Liu, Chief Investment Officer of Kronos Research, believes that this crash was triggered by tariff concerns but exacerbated by excessive leverage from institutions, highlighting the close connection between cryptocurrencies and the macro economy.

ChainCatcher message, Zhao Changpeng posted on X platform stating that many projects have market makers, but BNB does not. He is unaware of any of his affiliated entities buying or selling BNB in the past few days/weeks. BNB has builders, a community, and BNB is "deflationary."