Why crypto crashed: 4 experts break down what Tuesday’s sudden drop might mean for the altcoin season and NFT frenzy — and share 12 high-quality tokens that are likely to continue rallying toward the year’s end.
While liquidation cascades moved prices, a mix of factors caused a liquidity shortage that intensified the dramatic intraday moves, according to Patrick Heusser, the head of trading at Crypto Finance Brokerage.
“On Tuesday, we had the perfect storm because you had the long US holiday weekend. You had an upward moving market, so the market makers were notoriously short cash because they had to hedge all their futures they lost to the leverage guys,” Heusser told Insider, adding that these were his personal thoughts. “And then they were probably a bit too complacent on Monday, not sending enough capital quickly to their trading venues.”