WLFI Spiked Five Hours Before BTC Crash, Signalling Large Liquidations
Amberdata analysis shows World Liberty Financial token (WLFI) experienced abnormal activity more than five hours before a major Bitcoin (BTC) crash on October 10, 2025. WLFI’s hourly volume surged to $474M (≈21.7x normal) shortly after tariff-related news, its perpetual futures funding rate hit 2.87% per 8 hours (equivalent to ~131% APR), and its price decoupled sharply from BTC. That day about $6.93 billion in leveraged crypto positions were liquidated within an hour: BTC fell ~15%, Ether (ETH) ~20%, and smaller tokens dropped up to 70%. Amberdata and Cointelegraph-cited researcher Mike Marshall suggest WLFI’s concentrated ownership and extreme leverage likely amplified early liquidations and may act as a leading indicator during market shocks, though this does not prove insider trading. The report highlights WLFI’s potential to trigger stress in liquid assets and urges monitoring of futures and funding rates. Key trading levels noted: BTC supports near $60k–$65k and resistances around $70k–$78k; current technicals showed BTC oversold (RSI low) and trading below EMA20. This is informational, not investment advice.
Bearish
The news points to a negative market impact. WLFI’s extreme volume spike, outsized funding rate and concentrated ownership preceded a wave of leveraged liquidations that propagated into BTC and ETH, causing sharp intraday losses. Historically, leveraged altcoin collapses (e.g., 2021 margin squeezes, FTX-era contagions) have quickly transmitted stress to large-cap crypto via cross-margining and forced deleveraging, amplifying volatility and downside pressure. Short-term: expect elevated volatility, widening funding spreads, and potential further liquidations as traders rebalance or deleverage—bearish for spot and leveraged long positions. Long-term: if such events repeat, they may prompt tighter risk management, reduced leverage, and regulatory scrutiny, which could lower speculative flows but improve market resilience. Traders should watch WLFI-like funding spikes, cross-asset correlations, and open interest/funding rates as early risk signals.