Crypto Crash Explained: Analyst Pinpoints $19 Billion Wipeout and Forecasts Parabolic Rebound

The cryptocurrency market recently experienced one of its sharpest single-day drops, stunning investors and triggering widespread panic. Bitcoin (BTC) plunged from above $125,000 to briefly below $102,000, while Ethereum (ETH) dropped below $3,800. This sudden collapse followed a quick change in sentiment after Bitcoin’s recent all-time high on October 6.

A major factor accelerating the downturn was the external market shock caused by the U.S. government’s announcement of new tariffs on Chinese tech imports, which rattled investors. However, the severity of the drop was amplified by the structure of crypto trading itself. The practice of leveraged trading, where traders borrow heavily, sometimes up to 100x in crypto, was a key driver of losses. When prices moved rapidly downward, these borrowed positions were forcefully liquidated, causing a "spiral of cascading liquidations". In total, more than $19 billion in leveraged trades were wiped out across exchanges in under a day, making it one of the largest wipeouts in crypto history.

Despite the shock, the market crash aligned almost perfectly with the prior projections of market commentator Ash Crypto. His October 1 post on X warned of a “pump-then-dump setup” designed to trap overconfident bulls before a major rebound. He predicted this correction phase would transition into a powerful recovery in the last ten days of October.

Now that the dip has played out, Ash Crypto maintains a bullish outlook. He explains that once market sentiment becomes overwhelmingly bearish, short positions will pile up, which will trigger a reversal in the final ten days of October. This reversal is expected to lead to "parabolic candles". Ash Crypto projects that Bitcoin will reach between $150,000 and $180,000 by the end of the fourth quarter, with Ethereum trading in the $8,000 to $12,000 range. Following this movement, he anticipates a full-fledged altcoin season with potential 10x to 50x growth for many altcoins. At the time of writing, the market appears to have stabilised in a rebound-to-stable position.