Bitcoin News Today: Bitcoin's Bumpy Road: Leverage, Liquidations, and the Quest for Stability

The cryptocurrency market continues to grapple with the aftershocks of a record-breaking liquidation event, as traders and analysts assess the path forward. On Oct. 10-11, crypto derivatives markets saw $19.35 billion in liquidations, the largest in history, according to data from CoinGlass. Two weeks later, Bitcoin (BTC) is nearing pre-crash price levels, with analysts cautioning that volatility remains a key risk.

Bitcoin's price action has drawn attention from traders like CrypNuevo, a high-accuracy analyst who outlined a roadmap suggesting BTC could target the $121,000 level. This price zone is supported by liquidity pools formed during the recent crash. However, CrypNuevo warned that Bitcoin must first clear the "CME gap" from its recent price action, a technical hurdle that could trigger further retracement. To hedge against potential downside, the analyst has already taken profits in a third of their long positions, placing limit buy orders around $111,000 and $112,000, according to a Yahoo Finance report.

The market's turbulence has also exposed vulnerabilities in crypto infrastructure. Decentralized exchange dYdX is set to vote on a $462,000 compensation plan for traders affected by an eight-hour chain halt during the Oct. 10 crash. The outage, caused by a misordered code process and delayed validator restarts, led to erroneous liquidations, though no on-chain funds were lost. The governance community's decision will determine whether the protocol's insurance fund covers the losses, according to a TradingView report.

Meanwhile, the oldest crypto exchange bankruptcy saga continues. Mt. Gox, once the dominant Bitcoin exchange, has delayed creditor repayments until Oct. 31, 2026—another year's reprieve. The Rehabilitation Trustee cited incomplete procedures as a barrier to full payouts, despite having completed early and intermediate distributions. The exchange, which filed for Chapter 15 bankruptcy in 2014 after losing 650,000 BTC, currently holds 34,689 BTC valued at $4 billion, according to Yahoo Finance.

Macro factors are also shaping market sentiment. The U.S. Federal Reserve's 25-basis-point rate cut on Oct. 29, coupled with the halt of quantitative tightening, initially buoyed crypto markets. However, Fed Chair Jerome Powell's cautionary remarks—that a December rate cut is "not guaranteed"—sparked renewed selling. In the 24 hours following the announcement, crypto liquidations reached $795 million, with Bitcoin testing critical support levels around $108,000–$110,000, according to Yahoo Finance.

Geopolitical developments added to the volatility. After U.S. President Donald Trump's meeting with Chinese President Xi Jinping, which eased trade tensions, crypto markets fell further. Liquidations surged to $150 million within an hour, with Bitcoin, Ethereum, and XRP all dropping over 3% in 24 hours. Analysts attributed the selloff to lingering uncertainty about the Fed's policy path and excessive leverage in futures markets, according to an FXStreet report.

The liquidation frenzy has also raised regulatory concerns. Onchain data revealed a $160 million short position taken just 30 minutes before Trump's tariff announcement, sparking allegations of potential insider trading. Blockchain analysts noted that such timing and scale of profit highlight gaps in crypto regulation, urging policymakers to update enforcement frameworks to address digital assets, according to a Coinotag analysis.

As the market stabilizes, institutional activity offers a glimmer of optimism. Michael Saylor's Strategy added 390 BTC ($43.4 million) to its reserves, while American Corporation became the 26th largest corporate Bitcoin holder after acquiring 1,414 BTC. Ethereum also broke above $4,200, following Bitcoin's lead in a broader market recovery, as the earlier Yahoo Finance report noted.

The path forward remains fraught with challenges. With leverage still prevalent in futures markets and macroeconomic signals mixed, traders must navigate a landscape where rapid reversals are the norm. For now, the industry watches closely as Bitcoin hovers near key technical levels, with both bulls and bears positioning for the next move.