After record crypto crash, investors rush to hedge against another free fall

Following the largest crypto liquidation in history on Oct 10, options market investors are bracing themselves for more volatility and further declines in Bitcoin and Ether, aggressively positioning in trades that offer protection against another potential free fall.

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Market participants said the crypto sector on Oct 10 saw more than US$19 billion (S$24.7 billion) in liquidations across leveraged positions as panic selling and low liquidity triggered sharp swings.

The plunge came after US President Donald Trump announced late on that day a 100 per cent tariff on Chinese imports and threatened export controls on critical software.

Crypto analysts said this was the largest wipe-out in a 24-hour period in the market's history, nine times larger than the February 2025 crash and 19 times bigger than the March 2020 meltdown and the FTX collapse in November 2022.

Bitcoin fell as low as US$104,782.88 during the Oct 10 to 11 period, down more than 14 per cent from its high of US$122,574.46 on Oct 10. It was last up 0.6 per cent at US$115,718.13. The world's largest cryptocurrency hit a record high above US$126,000 on Oct 6.

Ether, the second-biggest digital currency, dropped 12.2 per cent to a low of US$3,436.29 on Oct 10. It last changed hands at US$4,254, up 2.4 per cent on the day.