Bitcoin, Ethereum, XRP, and other major altcoins tumbled as the crypto market shed over $200 billion in value. In just 24 hours, more than $1.2 billion in long positions were liquidated, sending shockwaves across traders. The crash came right before a massive Bitcoin and Ethereum options expiry worth over $16 billion, leaving investors anxious about what’s next.
Options Expiry Triggers Profit-Taking
The latest dip appears to be driven by traders and large institutions taking profits ahead of the October 31 options expiry. Data from CME and Deribit indicate that these derivative contracts have a strong influence on short-term price movements.
On Deribit alone, over 123,000 Bitcoin options worth $13.52 billion are set to expire. With a put-call ratio of 0.70 and a max pain price near $114,000, dthe ata suggests potential upside after expiry. However, in the past day, put volumes surpassed call volumes (1.35 ratio), signaling that traders are hedging for further downside. Still, some analysts expect Bitcoin to rebound above $112,000 once the expiry concludes.
Why the Crypto Market is Dropping?
Crypto analyst Miles Deutscher attributes Bitcoin and Ethereum’s weakness to several factors. He highlighted an ongoing “DAT unwind,” where digital asset trusts are protecting their values, adding mild selling pressure. Additionally, ETF demand has cooled, with consistent outflows in recent weeks reflecting a temporary lack of institutional interest.
Deutscher also noted that October 10 inflicted lasting damage on the market — as market makers unwound positions, retail confidence eroded, and sentiment hit rock bottom. However, he believes a single strong Bitcoin rally could reverse the trend. Historically, Bitcoin often tracks equity market momentum, and with stocks hitting new highs, a “catch-up rally” wouldn’t be surprising.
Look Out for Emerging Sectors
Deutscher urged traders to use this quiet market phase to explore emerging sectors such as x402, robotics, real-world assets (RWA), and prediction markets. He emphasized that the best opportunities often arise when most traders have stepped back from the market.
Institutional Interest Remains Weak
According to on-chain analytics firm CryptoQuant, fading institutional demand and uncertainty over U.S. monetary policy are the main drivers behind the recent downturn. The Coinbase Premium Gap turned negative, signaling weak U.S. buying activity.
However, CryptoQuant expects liquidity conditions to improve once the Federal Reserve officially ends quantitative tightening, which could boost risk appetite heading into 2026.
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FAQs
Yes, Bitcoin often leads market trends. Its recent drop, driven by massive options expiries and weak ETF demand, has created a domino effect, causing major altcoins like Ethereum and XRP to tumble in its wake.
Absolutely. Uncertainty over U.S. monetary policy and the Federal Reserve’s stance has weakened institutional risk appetite, directly impacting crypto liquidity and contributing to the recent market downturn.
The total crypto market capitalization shed over $200 billion in a 24-hour period, a sharp decline that led to the liquidation of more than $1.2 billion in leveraged long positions.
Some analysts expect a potential rebound after the options expiry concludes. A catch-up rally could occur if Bitcoin follows equities higher, with improved liquidity conditions possible into 2026.
Traders should monitor the post-options expiry price action for a potential rebound, track Bitcoin’s correlation with the stock market, and research emerging sectors like real-world assets (RWA) and AI.
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