Market Event - A stablecoin on one exchange experienced a flash crash, plummeting to $0.65 due to an internal pricing issue [1] - The stablecoin crash triggered ADL auto-deleveraging, leading to cascading liquidations that closed millions of accounts within minutes [1] - The incident is described as a system-wide chain reaction caused by a code-level flaw [1] Impact on Market Makers and Liquidity - The flash crash severely damaged market makers' balance sheets [1] - Market makers were forced to shrink capital, further weakening market liquidity [1] - The weakened liquidity resulted in sustained pressure on crypto assets in the weeks following the event [1]

Tom Lee: Stablecoin Flash Crash Triggered Cascading Liquidations, Sending Bitcoin Into a Tailspin After October 10In a CNBC interview on November 21, Bitmine Chairman Tom Lee addressed the key question of "what exactly happened on October 10". He explained that a stablecoin on one exchange suddenly dropped to $0.65 due to an internal pricing issue, triggering the ADL auto-deleveraging mechanism and causing cascading liquidations that forced millions of accounts to close within minutes. Lee noted that the in ...