What happened to the cryptocurrency market with a 30% drop in altcoins due to the “610” attack?

What caused the 30% drop in altcoins in the cryptocurrency market during the "610" attack?

Market conditions suddenly changed in the cryptocurrency market on the afternoon of June 10th. Although BTC and ETH did not decline significantly (both around 3%), other altcoins experienced short-term declines ranging from 10% to 40%. According to the OKX decline list, the declines of many well-known altcoins, including LOOKS, TON, CETUS and DASH, were all over 25%.

Under extreme volatility, a total of $217 million was liquidated in the past hour, including approximately $203 million in long positions and approximately $13.83 million in short positions.

Considering that the decline of BTC and ETH is not obvious, but altcoins are more affected by the special market conditions, some industry insiders speculate that the cause of this round of decline may be due to the sudden withdrawal of a large market maker. Since BTC and ETH themselves have many market makers and good liquidity, only altcoins have suffered.

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Opinions from: Kay, a partner of NGC

Opinions from: nick, a partner of Exit Liquidity Capital

After further analyzing the origin of the market changes, many industry insiders speculate that it seems that a market maker above Binance suddenly withdrew funds (not yet confirmed), and as for which market maker specifically, it is currently impossible to accurately speculate.

Opinions from: Twitter KOL Jake gives no facks

Opinions from: Twitter KOL EthDaddy

Some industry insiders speculate that the market maker may be Cumberland, based on Cumberland’s withdrawal of 37,600 ETH from Binance and Coinbase after being sued by the SEC.

Opinions from: Mudit Gupta, Chief Information Security Officer of Polygon

Aside from the speculation about “market maker flight,” there are other bearish news within the industry today, such as TUSD temporarily stopping the minting of TUSD through Prime Trust and Grayscale submitting a request to the SEC to withdraw its application for Filecoin Trust. However, objectively speaking, these news are unlikely to cause such a significant impact on the market, so we still lean towards the speculation mentioned earlier.

Earlier this week, with the SEC filing lawsuits against two major exchanges, Binance and Coinbase, the cryptocurrency market faced another round of regulatory crackdowns.

Under the SEC’s intense scrutiny, some institutions that have dealt with cryptocurrencies in the past have begun distancing themselves from the industry due to compliance pressure. For example, Robinhood has decided to delist “securities” tokens mentioned in the lawsuit (these tokens have also seen significant losses in this round).

Therefore, it is understandable if market makers choose to exit early due to the same compliance pressure or concerns about the future market trend (if severe one-sided market trends emerge due to regulation, market makers will face greater inventory risks).

It is worth noting that in the SEC’s lawsuit against Binance, the SEC also accused two major market makers on the Binance platform, Sigma Chain and Merit Peak, of having hidden connections with Binance, and the flow of funds was not transparent. It is unclear whether this accusation is related to today’s market fluctuations.

As of the time of writing, after the first round of sharp declines, the market seems to have stabilized somewhat. As for how the market will develop in the future, we will continue to follow up and report.

We will continue to update Blocking; if you have any questions or suggestions, please contact us!