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Crypto resets after record leverage flush, focus shifts to safety and recovery
Markets absorbed a historic liquidation wave and funding rates hit multi-year lows. Bitcoin and Ether rebounded, while security habits moved to the front of your playbook.
Joe G & Money Talks
October 13, 2025 • Estimated Reading Time: 5 minutes
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What we will talk about today...
Seven habits to avoid crypto hacks in 2025
Funding rates drop to 3-year lows after historic flush
Bitcoin targets 120K after record wipe-out
Ether eyes 4,500 as derivatives stabilize
Everyday traps still steal more than exotic exploits. Simple habits lower risk fast.
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Theft in H1 2025: Over $2.4B across 300+ incidents, surpassing 2024 totals.
Explanation: Losses concentrate in common traps, not rare bugs.
Top risks: Phishing links, toxic approvals, SIM swaps, fake “support”.
Explanation: One rushed signature or call exposes funds.
Core defenses: Phishing-resistant 2FA, careful signing, hot and cold wallet split, clean devices, recovery plan.
Explanation: Reduce attack surface and make mistakes survivable.
“Read every signature request. Real support never asks for your seed phrase.”
“Keep spending in a hot wallet, store savings cold.”
Funding rates drop to 3-year lows after historic flush
Perps flipped deeply negative as shorts piled in. Reversal risk rose.
Leverage reset: Lowest funding since 2022.
Explanation: Speculative excess washed out across major venues.
Positioning shift: Short crowd grew, short squeeze risk increased.
Explanation: Negative funding signals short dominance, rebounds punish crowded shorts.
Price reaction: BTC bounced over 5 percent, ETH rebounded about 12 percent from weekend lows.
Explanation: Spot buyers stepped in after forced selling.
“This marks one of the most severe leverage resets in crypto history.”
“Volume birthed a $20,000 red candle in Bitcoin before a V-shaped bottom.”
Bitcoin targets 120K after record wipe-out
BTC reclaimed 116K. Traders watch 112K support and 120K resistance.
Volatility spike: Implied volatility jumped to April highs.
Explanation: Options priced larger swings after the tariff shock.
Key levels: Hold above 112K on daily and weekly, test 120K next.
Explanation: Closing levels guide momentum into the week.
Macro watch: Powell speaks at NABE, inflation prints delayed by shutdown.
Explanation: Policy tone steers liquidity expectations into October 29.
“Looks pretty alright as long as price doesn’t close below 112K on 1D and next 1W.”
“Don’t worry about China, it will all be fine!”
Ether eyes 4,500 as derivatives stabilize
ETH retook 4,100 and showed relative strength versus peers.
$BTC
Looks like $115K was a key trigger for some large players too (likely a firm)— Skew Δ (@52kskew)
8:34 PM • Oct 12, 2025
Perps dislocation: Funding plunged to about minus 14 percent.
Explanation: Shorts paid to stay open, a setup with limited durability.
Futures premium: Monthly futures snapped back near 5 percent.
Explanation: Term structure returned to neutral, fear faded outside perps.
Options balance: No stress signal in put-to-call flows on Deribit.
Explanation: Flows stayed orderly, no rush into protection.
Financial markets are evolving:
The -$19.5 billion crypto liquidation and -$2.5 trillion equity market crash on October 10th have highlighted a crucial point.
Markets in 2025 have evolved to their most reactionary form in history.
When you couple this with record levels of
— The Kobeissi Letter (@KobeissiLetter)
7:22 PM • Oct 12, 2025
“ETH monthly futures absorbed the shock within hours, premium back to neutral.”
“Options flow looked balanced, no panic bid for puts.”
Funding rates across the crypto market have plunged to their lowest levels since the depths of the 2022 bear market.
This marks one of the most severe leverage resets in crypto history, a clear sign of how aggressively speculative excess has been flushed from the system.
— glassnode (@glassnode)
4:05 PM • Oct 12, 2025
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This article is not financial advice. Market conditions can change rapidly, and past performance does not guarantee future results