🐳 Daily Edition: Crypto in the Red as October 10th Bodies Surface

November is off to a rough start to say the least, as Bitcoin has dropped over 6% since the start of the month forcing billions in liquidations in the process. In fact, yesterday saw BTC break under the $100k line for the first time since June this year. I’m not typically someone who believes in magical lines on charts, but even I have to admit the psychological impact of falling under 6 figures again is real. Sentiment among traders is as low as it was during the depths of the bear market in 2023, and Bitcoin is trading more than 4 times higher now. This should speak to how difficult a market it’s been for altcoins, many of which have now fallen back towards the lows they saw on October 10th (the biggest day of liquidations in crypto history). We’re also seeing trouble in DAT world, as almost every single one is now trading under their NAV — Ethereum DAT ETHZilla was one of the first to sell treasury holdings to buy back stock, but with the way things are looking we could see an increase in that activity across the board.

Although October 10th saw massive liquidations, we have yet to see exactly which entities were hit the hardest. As of this week we have our first, however, by way of stablecoin yield protocol Stream Finance. On Monday Stream announced that an external fund manager responsible for sourcing yield for Stream users had lost over $90 million, presumably due to being liquidated on 10/10. This announcement sent their stablecoin XUSD into a death spiral as users realized less than half of user deposited funds were still left in the protocol. Other offchain agreements with lenders have made the situation even more complicated than it was before, leading many to realize that the DeFi protocols they’ve been using are really not that decentralized after all. Yield protocols that operate as a “black box” where users can’t see exactly what’s being done with their money are a ticking time bomb, and I suspect Stream was not the only one deeply affected by market conditions. As always, be careful and do research into how yield is produced; if you can’t easily identify where the yield is coming from, it’s probably coming from you.

Wintermute is to blame for everything.

The Beluga intern has been hard at work gathering all the most important crypto news stories so you have them in one place!

The Majors

• Why Bitcoin traders should ‘buy the dip, in stages’

• Ripple raises $500 million at $40 billion valuation following XRP’s historic surge

Alt Coins and Stocks

• Crypto’s big money backers hit hard as stock premiums plunge

• Dinari taps Chainlink to tokenize S&P DJI’s upcoming crypto market index

New Launches

• Monad to TGE on November 24th

• Paradigm leads $6 million seed round for Harmonic, aiming to help Solana reach Nasdaq speed

Interesting Reads

• Why On-Chain Gold is a Trap

• Balancer’s $100M exploit explained

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