← Coin Stories with Natalie Brunell
Coin Stories with Natalie Brunell
News Block: Record Crypto Liquidation, China Tensions Over Rare Earths Hit Markets, U.S. Treasury Props Up Argentine Peso
00:11:49
In this week's episode of the Coin Stories News Block powered exclusively by Ledn, we cover these major headlines related to Bitcoin, macroeconomics, and global finance: Record crypto liquidation event: who got wiped out and why Bitcoin held firm...
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Welcome to the Coin Stories news block powered exclusively by LEDN. I'm Natalie Brunel and in about 10 minutes or less I'll provide you with insightful updates on bitcoin, financial markets and the global economy. Everything you need to know in one block. Let's go.
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Hey everyone. What a wild weekend of price action after bitcoin hit a brand new all time high just last week. It dropped nearly $20,000 in the matter of hours on Friday, wiping out roughly $380 billion in market value. Before. Before eventually bouncing back over 115k. There were questions of a whale insider trading. And it was absolute carnage for many crypto tokens. The largest liquidation event in the industry's history, according to Coinglass. In a single 24 hour window, more than 1.6 million traders were liquidated across major derivatives platforms totaling over $19 billion. And the real figure may be even higher, given how some venues report. Holy smokes. So if a trader found themselves levered long on Friday, chances are they got wiped out. Estimates suggest over 80% of the liquidations were longs. Now it's important to note that the worst sell offs happened outside of bitcoin. Bitwise's Jonathan Mann summarized the event saying, quote, in one hour, Bitcoin fell 13% from peak to trough. Altcoins losses were even more severe. The Token Atom fell 100% in the span of an hour to virtually zero. You heard that right. Some tokens literally went to zero before rebounding. Now how is that possible? Because outside of bitcoin, many cryptocurrencies have very little organic liquidity. Bitcoin's liquidity is deep because independent buyers and sellers show up every day for their own reasons. Many small tokens don't have that steady two sided flow. Instead, they lean on paid market, making firms to keep trading going. So when panic hits and those market makers step back to manage risk, just as investors rush for the exits, suddenly there are no real buyers left. The already thin order book can go empty and prices can crash in dramatic air pockets. That's how the price for some of these tokens dropped 80, 90, even 100% in just a matter of hours. Bitcoin dominance. Bitcoin share of the total crypto market cap spiked during the chaos, underscoring the point that outside of bitcoin, the broader crypto market sold off much harder. And I think there are two big takeaways from this event. First, leverage kills. Or as Custodia CEO Caitlin Long always says, quote, a fool and his leveraged bitcoin are soon parted. I've seen many investors learn this lesson the hard way. So my advice is for people to avoid leverage and just stay humble and stack sats. Second, liquidity is everything in a panic. And when it comes to liquidity in crypto, there's Bitcoin, then there are stablecoins, and then there's everything else. First, for large institutional investors managing massive portfolios, Bitcoin's deep organic liquidity is critical. And it becomes most obvious during market drawdowns. Alright, now there are some positives to consider after this crash. Wall street has a saying, Bulls make money, bears make money, pigs get slaughtered. A leverage flush is a market cleanse. It clears out the overextended traders and resets the foundation for the next leg up. And despite the largest liquidation event ever, Bitcoin held up remarkably well. James E. Thorne noted this in a now viral post on X writing quote, largest liquidation event ever and Bitcoin is sitting at 114,000. Think about that for a minute. I couldn't agree more. The fact that Bitcoin is still trading at the same level it was at not even two weeks ago shows just how resilient this asset has become. When you zoom out, you realize that absolutely nothing has changed when it comes to Bitcoin's fundamentals. The debasement trade didn't vanish with one volatile day. If anything, recent developments have only reinforced it. Need cash, but don't want to sell your Bitcoin? LEDN is the global leader in Bitcoin backed loans, issuing over $9 billion in loans since 2018, and they were the first to offer proof of reserves. With Leden, you get custody loans, no credit checks, no monthly payments, and more. Visit LEDN IO Natalie to learn more and get a quarter percentage point off your first loan. This past week, the White House rushed to stabilize Argentina's economy in a moment of acute illiquidity, finalizing a $20 billion currency swap and even directly buying Argentine pesos in an attempt to prop up the falling currency. The peso has lost nearly 40% of its value against the dollar in 2025 alone. Treasury Secretary Scott Besant confirmed this currency intervention in a tweet saying, quote, we directly purchased Argentine pesos. So to recap, we have one government that's more than $37 trillion in debt and is going through its own fiscal crisis, using its printed fiat to prop up another country's even more mismanaged fiat. Furthermore, Bessen added that the U.S. treasury is prepared immediately to take whatever exceptional measures are warranted to provide stability to markets. Translation, we will not hesitate to print in the name of market stability. It's really absurd when you stop to think about all this. Let's not forget that the government still hasn't bought any Bitcoin for its strategic Bitcoin reserve, right? So instead of buying some of the best money in the world, the government is choosing to buy some of the worst money in the world. And if this all sounds like one big house of cards to you, then you're not alone. It's why investors are increasingly looking toward hard assets like gold and Bitcoin, which governments can't print to preserve their wealth. One CNBC headline this week posed a question to readers saying, quote, the debasement trade is the talk of Wall Street. Is it too late to get in? My answer it's never too late to protect your savings. I'm actually of the belief that gold still has a long way to run, even if it might have some pullbacks. But of course, you know, my favorite is bitcoin. Yes, Bitcoin's price will swing as leverage builds and flushes. But if you tune out the noise and zoom out, fiat supply keeps expanding while bitcoin's supply stays fixed. And in the end, that's all that really matters. So let's dig into why the White House is using dollars to prop up the peso. After all, it's not out of charity. As Secretary Bessant made clear in a recent interview on Fox News, the goal is actually to limit China's influence in the region. Argentina has important resources, and we wouldn't want them to get a currency lifeline from China. Which brings us to the main spark behind this past week's macro turmoil rising tensions between the US And China. Now, it all began when China unveiled sweeping export controls on rare earth minerals and related technologies. These new restrictions would require Beijing's approval even if a product contains trace amounts of Chinese rare earth content or uses Chinese extraction or refining or magnet making methods. And because Chinese rare earths are embedded in everything from iPhones and electric vehicles to fighter jet sensors, the new rules effectively give Beijing potential veto power over vast swaths of global manufact. As macro analyst Luke Gromen frames it, this is supply chain weaponization. Luke says this is effectively a Chinese embargo on critical rare earth minerals and that it will, quote, massively disrupt global supply chains, especially military and technology. I highly recommend everyone listen to my recent interview with Luke Grohman, where we discuss this topic in depth. There's nobody better at connecting the dots there. Policymakers clearly see the same risks too. Because President Trump quickly threatened 100% tariffs on on all Chinese products in response. That's when the market had a complete meltdown, why it felt like Liberation Day 2.0, and because, all things considered, an escalating trade war between two superpowers is not good for growth or inflation. Since Trump's tariff threat, Beijing has downplayed Trump's concerns over the new rules. Furthermore, on Sunday afternoon, President Trump posted again on the matter, writing quote, don't worry about China. It will all be fine. President Xi just had a bad moment. Hmm. Okay. Now, I for one don't think this is a nothing burger. China does hold an immense amount of leverage when it comes to critical minerals, from mining them to refining them. And it would take us 10, if not 20 years to try to catch up to where China is in terms of supply chain dominance. So we'll see how markets respond to all this after the holiday weekend. But big picture episodes like this are exactly why neutral monetary alternatives are in such high demand. I mean, gold just eclipsed $4,000 an ounce for the first time ever last week. And it makes sense. As the traditional monetary system becomes more politicized, apolitical monies look more and more attractive. As Michael Saylor says, no tariffs on Bitcoin. In a world of increasing trade frictions and weaponized supply chains, gold and Bitcoin are standing out to everyone. Alright, let's close this news block with a rapid fire of some more big stories that caught my eye. First. First, by the way, don't miss my brand new interview with Leden's very own Maurizio DiBartolomeo about Bitcoin backed loans and his fascinating journey out of Venezuela with Bitcoin. Next up. There are signs of institutional adoption everywhere you look these days. And this past week we had several developments. The first came from Morgan Stanley. The banking giant announced that the firm is broadening access to crypto to all of its clients, allowing such investments in any type of account, including retirement accounts. Previously, bitcoin access was limited to just wealthy clients, and now it's available to everyone. Exactly how it should be. This news came as Morgan Stanley's Global Investment Committee published a new special report recommending an allocation of up to 4% to digital assets. According to Bitwise CEO Hunter Horsley, this committee guides 16,000 financial advisors managing around $2 trillion. So the importance of this policy change cannot be overstated. So Morgan Stanley appears to be taking the lead with Bitcoin. But other large financial institutions are not so far behind. A new study from State street found that institutional investors plan to double their digital asset allocations over the next three years, with around 25% expecting Bitcoin to remain the top performer during the same time frame. And some global institutions are already making moves. Luxembourg just made headlines this week by becoming the first eurozone sovereign wealth fund to allocate to Bitcoin. Sovereign wealth funds remain a huge, largely untapped pool of capital when it comes to Bitcoin, so it's good to see adoption at the sovereign level continuing to gain momentum. And lastly, this past week we got a major update from block. Starting November 10th, all merchants in the Square ecosystem will now be able to accept Bitcoin and seamlessly stack sats from their daily sales. According to Block's public filings, more than 4 million sellers currently use the Square ecosystem, and recent surveys estimate that over one third of all U.S. small businesses use it. So this is a huge deal when it comes to Bitcoin adoption at the merchant level. It's developments like these that will help push Bitcoin into every nook and cranny of the traditional financial system. This is how Bitcoin spreads build the pipelines, remove the barriers, and let anyone sovereigns, advisors, businesses opt in. After all, Bitcoin is for everyone. And speaking of that, make sure to pre order my upcoming book Bitcoin is for everyone. It releases November 18th and it is an approachable Bitcoin 101 book for the masses. I can't wait for all of you to read it.
- [11:29]
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That's it for the News Block, your weekly Bitcoin and economic news update. Powered exclusively by ledn. I'm Natalie Brunel.
- [11:35]
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Make sure you're subscribed to Coin Story.
- [11:37]
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So you never miss an episode. This show is for educational purposes and should not be construed as investment advice. Until next time, keep stacking.