Crypto market loses $300 billion this week as Ether fell 12% and Bitcoin dropped 5%

The crypto market got slammed with a brutal $300 billion loss this week as leverage-heavy trades across the board unraveled, tanking major coins and dragging overall sentiment to levels not seen since June.

The crash started snowballing after Ether dropped a steep 12%, its worst weekly drop since the middle of the year. That fall sent it crashing below $4,000, a level traders had been watching like hawks for months.

Bitcoin, the industry’s benchmark, took a 5% hit, its biggest weekly fall since March, and now floats at the low end of its trading band.

Traders got crushed when billions in bullish positions blew up in the perpetual futures market. Over $3 billion in long positions were liquidated across various exchanges as the market flipped direction hard. And that figure might not even capture the whole mess since most platforms don’t reveal full liquidation numbers.

The whole thing triggered a cascade effect across crypto, sending prices lower across the board. Despite a brief pause on Friday, when new inflation numbers gave the Federal Reserve room to breathe, the bounce barely lifted the mood. Crypto is still bleeding.

Bitcoin ETFs post major outflows while corporate buyers disappear

Thursday was another rough session, with Bitcoin and Ether ETFs listed in the U.S. seeing more than $500 million in total outflows. That same day, Arthur Azizov, founder of B2 Ventures, said, “Bitcoin’s fall below $109,000 is a sign this market’s overheated and headed into a cooling phase.”

That level hadn’t been broken since early September. The dip came as the appetite from institutional buyers completely dried up. Those corporate treasuries that were loading up on crypto during the summer are now pulling back hard.

In July, they bought 64,000 Bitcoin. But in August, it dropped to 12,600. This month, they’ve only bought 15,500 so far. That’s a 76% plunge compared to the previous buying spree. The numbers come from CryptoQuant, and they show exactly how fast interest has died.

Firms that used to raise money through PIPE deals, private investments in public equity, are now seeing their stocks trading 97% below their initial price. These companies were once seen as stable buyers of crypto, holding Bitcoin on their balance sheets like digital gold.

The idea was that corporate treasuries, pension funds, and public firms would lock up Bitcoin long-term and help anchor the market. Now, that theory is falling apart. With less cash and no incentive, these players aren’t stepping in anymore.

Paul Howard, senior director at market-making firm Wincent, called the pullback a “healthy correction.” But he didn’t pretend everything’s fine. With Bitcoin now below its 100-day average and total crypto market cap back under $4 trillion, Paul warned that pressure could keep mounting.

“There’s no panic, but crypto’s now following macro trends way more than before,” he said. “For the first time in 2025, I’m questioning whether we’ll even revisit all-time highs this year.”

Futures traders liquidated as retail ETF inflows keep climbing

On top of that, derivatives traders are getting smoked. Within the last 24 hours alone, $275 million worth of Bitcoin longs were wiped out. The demand for longer-dated futures is falling fast. Risk appetite is evaporating. But not everyone’s running; retail buyers are still pouring in through ETFs.

The iShares Bitcoin Trust ETF pulled in $2.5 billion in September, way up from $707 million in August, as reported by Bloomberg. Even as institutional players vanish, retail investors are still chasing exposure.

Jeff Dorman, chief investment officer at Arca, said the drop isn’t caused by selling. “It’s not that DATs are dumping—it’s that they stopped buying,” Jeff said. The lack of consistent demand from institutional treasuries has become a problem.

Those big buyers weren’t just a floor, they were the whole scaffolding. Morten Christensen, founder of AirdropAlert.com, had seen this coming. Back in August, when Bitcoin crossed $123,000, he warned friends and family to sell. He didn’t see a blow-off top or forced selling. It just didn’t feel right.

“All the treasury companies is a huge top signal in my books,” Morten said. His read was simple: when everyone’s bullish, maybe it’s time to get out.

Meanwhile, treasury-backed firms that once traded at massive premiums are now being priced at levels that match the actual Bitcoin they hold. The mNAV (the gap between their market cap and the value of their Bitcoin reserves) is nearly gone. These companies used to trade like tech unicorns. Now they’re treated like glorified crypto vaults.

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