The Shocking Truth Behind the October 10 Crypto Collapse: A Financial Disaster Unveiled

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The October 10 crypto crash, which obliterated nearly $19 billion in leveraged positions within mere hours, left traders and analysts reeling in disbelief.

In a mind-bending BeInCrypto podcast, World Liberty Financial advisor and Glue.Net founder Ogle took a deep dive into the true cause of one of the largest single-day crypto catastrophes in recent history.

A Perfect Storm: How Everything Came Together to Ruin Your Portfolio

Ogle pointed out, there wasn’t just one villain behind the sell-off.

“You don’t die from heart disease just because you ate a lot of burgers,” he said. “It’s a thousand little things that come together and destroy you.”

He explained that the crash was the result of a volatile cocktail of liquidity shortages, over-leveraged traders, and a chain reaction of automated sell-offs fueled by macroeconomic jitters.

“In those steep dives, the bids to buy simply weren’t there. No one wants to touch it, even when the prices are bottoming out,” Ogle lamented.

He also suggested that Donald Trump’s comments on US-China relations acted as an amplifier, sending algorithmic trading systems into a panic and sparking a flood of automated short positions that sped up the decline.

Liquidity Gaps and the Over-Leverage Problem: The Recipe for Disaster

Ogle, a veteran in crypto since 2012, having helped recover over $500 million from hacks, pointed to over-leverage on professional exchanges as the primary culprit.

Many traders were indulging in “cross margin” – a system that ties all positions together like a doomed romantic relationship. When the market hiccupped, everything crumbled.

“My personal belief? Over-leveraging on professional exchanges is the root cause,” Ogle said. “It’s a cascade – if one position crumbles, everything else goes down with it. It’s like a domino effect of disaster.”

The Centralized Exchange Dilemma: A Familiar Tragedy

Ogle didn’t hold back in criticizing the crypto community’s obsession with centralized exchanges (CEXs), despite their record of repeated failures.

He mentioned Celsius, FTX, and a few others, as if we needed another reminder that trusting someone else with your assets is still too tempting.

“How many more scandals do we need before people wake up?” he sarcastically asked. “Spend an hour learning to use a hardware wallet, instead of losing everything in another CEX catastrophe.”

Despite their obvious flaws, CEXs are still easy. But the future belongs to decentralized finance (DeFi) and self-custody solutions – an evolution that even centralized players can no longer ignore.

“Coinbase has Base, Binance has BNB Chain – they’re creating their own chains because they know decentralization is coming for their throne,” he explained with a knowing smirk.

The ‘Gold Rush’ Mentality: How Greed Turned Crypto into a Casino

But Ogle didn’t just focus on the technical mishaps – he also pointed to a deeper, darker force at play: human greed. He likened the current meme coin mania and 100x trading to the California gold rush of the 1800s.

“Most people who went there didn’t make money. The ones selling shovels did. It’s the same now – the builders and service providers are the real winners, while the gamblers are left with empty pockets,” Ogle quipped.

He warned that crypto’s image is at risk. Instead of being seen as a technological revolution, it’s fast becoming “just another casino” for the outside world.

The Isolated Margin Revelation: A Simple Solution for Perpetual Trading

When pressed for advice, Ogle gave his listeners a lifeline:

“If there’s one thing you take from this podcast – and you plan on doing perpetual trading – it’s this: use isolated margin.”

Isolated margin limits your losses to a single position. Unlike cross margin, which has the charming ability to wipe out your entire account with a single market dip.

“The best advice I can give you: Always, always trade isolated,” Ogle emphasized with an air of finality.

In the end, the October 10 crypto crash wasn’t a result of one single event. It was the inevitable culmination of systemic over-leverage, low liquidity, and a speculative gambling culture that treats financial risk like a high-stakes game.

Until traders wake up and start taking self-custody seriously, crypto will continue to repeat these mistakes – and the numbers will just keep getting bigger. ⏳💰

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2025-10-21 22:53