The digital asset market faced its largest cascade of liquidations on October 10, and is now known as Black Friday of cryptocurrencies. In 24 hours, more than $19 billion in leveraged positions were eliminated, marking the largest deleveraging event in industry history.
The sell-off began at the end of the US session after President Trump announced a proposed 100% tariff on Chinese imports, sparking global risk aversion in stocks, commodities and cryptocurrencies. The steepest declines occurred within a 25-minute span, when high leverage collided with low liquidity. According to CoinDesk Reference Rates (CADLI), bitcoin fell to $106,560, ether to $3,551 and solana to $174, with smaller cap tokens falling more than 75% intraday.
Market dynamics and scale of deleveraging
According to CoinDesk Data, total perpetual futures open interest fell 43%, from $217 billion on October 10 to $123 billion on October 11. The biggest single-day contraction came on Hyperliquid, where open interest fell 57% from $14 billion to $6 billion as positions were unwound sharply.
Source: CoinDesk data
The data suggests that around $16 billion of the $19 billion total came from long liquidations, with almost all traders having 2x or more leverage without loss limits on altcoins being removed in a matter of minutes.
Public blockchains like Hyperliquid provided a rare and transparent look at the sequence of forced settlements, where the settlement queue and execution can be verified on-chain. By contrast, centralized exchanges aggregate settlement data in batches, meaning the true scale of forced decouplings may have even exceeded the widely reported $20 billion, as aggregated reporting often understates notional values.
Source: CoinDesk data
Structural stress and order book collapse
The episode underscored how closely coupled liquidity, collateral and oracle systems have become. What began as a slowdown driven by macroeconomic factors quickly evolved into a stress event that affected the entire market. As prices surpassed key liquidation levels, market depth collapsed by more than 80% on major exchanges in a matter of minutes.
In some cases, tight order books caused large-cap assets like ATOM to temporarily print near-zero bids; a reflection not of fair market value but of market makers withdrawing liquidity as risk systems throttled activity. With collateral shared across assets and venues reliant on local prices, feedback loops amplified volatility across the ecosystem. Even well-capitalized platforms proved vulnerable once liquidity evaporated across the board.
Fair Value Pricing in Volatility
When exchange-level prices become erratic, CoinDesk reference rates such as CCIX and CADLI act as stabilizing mechanisms. These multi-venue benchmarks aggregate prices from hundreds of sources, applying quality filters and outlier rejection to produce a consensus-based global fair value.
During the Black Friday volatility, benchmark rates revealed that valuations across the market remained much less extreme than certain venue-specific prints suggested. This transparency allows market participants to distinguish between genuine repricing and localized dislocation, providing a neutral reference for evaluating post-trade performance.
Reference rates don’t stop volatility, but they define it, ensuring traders, funds and exchanges have reliable data when the market breaks down.
Final thoughts
The severe market disruption demonstrated how leverage, liquidity and fragmented infrastructure can converge in a feedback loop that overwhelms even the largest trading venues. It also revealed the limits of transparency in a system where some on-chain exchanges, such as Hyperliquid, expose settlement flows in real time, while centralized venues still operate as partial black boxes.
The maturity of cryptocurrencies will be defined by how it internalizes these shocks. Better risk controls, unified assurance standards and real-time transparency will be as important as using pricing benchmarks. CoinDesk’s benchmark rates help confirm fair valuations when screens turn red, but true resilience depends on the exchange’s architecture, deeper order books, a more robust oracle design, and ultimately, the exchange’s uptime.
The industry now faces the choice between treating this as a singular event or as the blueprint for building a market that can absorb the next one.
