Ethereum News Today: Institutional Buys Stabilize Ethereum as Derivatives Market Collapses in $19B Liquidations

Ethereum (ETH) experienced a sharp price decline and derivatives market reset in October 2025, driven by escalating U.S.-China trade tensions and systemic leverage imbalances. The cryptocurrency fell nearly 17% to $3,700 following President Donald Trump's announcement of 100% tariffs on Chinese imports, triggering over $19 billion in leveraged position liquidations within 24 hours . This marked one of the largest single-day liquidation events in crypto history, with Ethereum long liquidations accounting for $235 million of the total . The collapse was exacerbated by thin liquidity during weekend trading and a localized depeg of the stablecoin USDe on Binance, which exploited pricing flaws to trigger cascading forced sales .

The derivatives market saw a dramatic reset, with open interest collapsing to levels last seen in 2021 and 2023 . Ethereum's price stabilized near $4,100 by October 13 as institutional buyers absorbed the fallout. BitMine, a major ETH holder, acquired 202,000 ETH at $4,154 during the downturn, increasing its holdings to 3 million tokens (2.5% of total supply) . This institutional accumulation, combined with reduced exchange supply-the lowest since 2016-signaled long-term confidence . Decentralized exchange (DEX) volume surged 47% to $33.9 billion, reflecting sustained on-chain activity .

Technical indicators suggested a potential recovery. Ethereum's price rebounded above key support levels, including the 200-day moving average, while the Seller Exhaustion Constant rose to 0.070, indicating bearish fatigue . Standard Chartered raised its 2025 ETH price target to $7,500, citing record ETF inflows and stablecoin growth . However, analysts cautioned that even reaching $7,500 from $4,200 represented a 75% gain, limited compared to presale opportunities like DeepSnitch AI . The derivatives market, though stabilizing, remained vulnerable to renewed leverage-driven volatility .

The U.S.-China trade conflict's direct impact on Ethereum was compounded by macroeconomic factors. A U.S. government shutdown and delayed Solana/XRP ETF approvals further dampened sentiment . Bitcoin's 14% drop to $104,782 underscored the correlated nature of crypto and traditional markets during geopolitical stress . However, Ethereum's resilience-falling only 5% in 48 hours compared to 84% for SUI and 70% for Avalanche-highlighted its institutional backing, including $23.5 billion in spot ETFs and $15.5 billion in open interest .

Looking ahead, Ethereum's trajectory hinged on several factors. Institutional buying and reduced exchange supply supported a bullish case, with technical resistance at $4,500 and $4,750 . However, derivatives markets remained fragile, with open interest and funding rates requiring close monitoring . If U.S.-China tensions eased and ETF inflows continued, Ethereum could test $4,500, but prolonged leverage exposure posed risks . The market's ability to absorb forced liquidations without cascading failures would determine its path forward.