Bitcoin News Today: Pumpkin's $138K Loss: A Symptom of Crypto's Leverage Crisis

The leveraged long position held by the crypto trading entity "Pumpkin" faced partial liquidation last week, resulting in a loss of approximately $138,500, according to on-chain data. The event unfolded amid heightened volatility in the cryptocurrency market, driven by geopolitical tensions between the U.S. and China, shifting Federal Reserve policy expectations, and erratic ETF flows. Bitcoin (BTC) and Ethereum (ETH) both experienced sharp price swings, with Bitcoin trading near $111,300 and Ethereum hovering around $3,957 as of press time, according to a Cryptonews report.

The liquidation of Pumpkin's position occurred against a backdrop of widespread market instability. Over the past 24 hours, the crypto market saw $817 million in total liquidations, with long positions accounting for $611 million of the losses, according to a Seeking Alpha report. This followed a broader liquidation cascade earlier in October, where $19.37 billion in leveraged positions were wiped out in a single day after U.S. President Donald Trump's announcement of 100% tariffs on Chinese imports triggered a flash crash, as reported by a Yahoo Finance article. Analysts attribute the recent turbulence to a combination of macroeconomic uncertainty and excessive leverage use, with Bitcoin's monthly performance now at risk of turning negative for the first time since 2014, the Cryptonews report added.

Bitcoin's price action has remained constrained within a $107,000–$111,500 range this week, failing to extend its so-called "Uptober" rally. Historical data from CoinGlass suggests Bitcoin typically gains 20% in October during bull markets, but the asset remains 2.3% below its monthly open, the Cryptonews report noted. Ethereum, meanwhile, has formed a potential "triple bottom" pattern around the $3,750–$3,800 zone, offering technical support for a rebound, the report added. However, ETF flows have turned bearish, with Ethereum ETFs bleeding $127 million in outflows since mid-August, while Bitcoin ETFs have seen $20 million in inflows amid the turmoil, according to the same coverage.

The Fed's recent decision to cut interest rates by 25 basis points to 3.75%–4% failed to calm markets, as Chair Jerome Powell warned against over-optimism about further rate cuts. Powell's remarks, coupled with the U.S. government shutdown entering its fourth week, have muddied the outlook for liquidity-driven risk assets like crypto, the Seeking Alpha report observed. Additionally, Trump's recent trade discussions with Chinese President Xi Jinping—while easing some tariffs—failed to stabilize sentiment, with the crypto market recording $150 million in long liquidations within an hour of the meeting's conclusion, according to an FXStreet report.

Market participants are now closely watching Bitcoin's ability to hold above $110,000 and Ethereum's resilience above $3,400 to avoid deeper corrections, an Economic Times report notes. On-chain data indicates accumulation by large holders for Ethereum, but Bitcoin's dominance has slipped to 47.8%, reflecting a broader rotation into altcoins like Solana (SOL) and XRP, the Economic Times article adds. Analysts at CoinMetrics argue the market remains in an early expansion phase ahead of the 2026 Bitcoin halving, but caution that leverage-driven volatility could persist until macroeconomic clarity emerges, the Economic Times coverage further cautioned.