Tom Lee Reveals Actual Cause of Crypto Crash - "There Is A Bug In The Code"

Market Analysis & Key Events - Crypto market has been under pressure since October 10th due to a significant deleveraging event [2][3] - A stablecoin, Athena's USDE on Binance, experienced a flash crash to $0.65 on October 10th, triggering automatic liquidations [9][10][11] - Approximately 2 million crypto accounts were wiped out due to cascading liquidations across exchanges [12] Technical Issues & Market Maker Impact - Tom Lee attributes the crypto crash to a "bug" or code error in automated liquidation processes (ADL) [1][7][14] - Market makers, crucial for providing liquidity, were crippled by the October 10th event, leading to reduced trading and further selling [3][4][5] - The ADL systems relied on single exchange price feeds instead of aggregating across multiple exchanges, exacerbating the liquidations [20] Recovery & Future Outlook - The current situation is compared to the Terra Luna collapse in 2022, suggesting a potentially prolonged recovery period [5] - The industry learned from past events like the 1987 portfolio insurance crash and the subprime mortgage crisis [16] - The underlying technology of cryptocurrencies like Bitcoin and Ethereum is functioning as intended; the issue lies in the processes of traders and market makers [19] - The current market conditions present a potential buying opportunity, as nothing is fundamentally wrong with the underlying technology [21][22]