Crypto's Black Friday Was Its Largest Liquidation Ever. What the Hell Happened? - Ep. 922

Unchained

Laura Shin

Tech News, Business News, News

4.6 • 1.3K Ratings

🗓️ 12 October 2025

⏱️ 55 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

When Trump tweeted about 100% tariffs on China, crypto collapsed — $19 billion in liquidations in just hours. Altcoins plunged 95%, exchanges froze, and stablecoins depegged. In this special episode, Diogenes Casares, founder of Klyra Protocol, joins Laura to break down the chain reaction: what really caused the crash, whether insiders knew it was coming, and how infrastructure failures and extreme leverage turned a policy tweet into crypto’s Black Friday. Thank you to our sponsor, ⁠Aptos⁠! Guest: Diogenes Casares, founder of Klyra Protocol and advisor at Patagon Management Links: Diogenes’s article on X: "Black Friday: What Happened?" Jordi Alexander on "What happened? Stani Kulechov on Aave’s performance Binance co-founder’s statement Timestamps: 💥 0:00 Introduction ⏱️ 1:00 What markets looked like in the hours before the crash 🕵️‍♂️ 3:25 Whether traders on Hyperliquid knew the tariff tweet was coming 📉 5:44 Why altcoins plunged up to 95% and how market makers amplified the move ⚙️ 7:56 How auto-deleveraging kicked in—and why it mattered 💣 13:07 How DATs created hidden leverage that made the system fragile 🏦 14:54 How perps DEXes and CEXes responded differently to the meltdown 🧩 18:09 Was it a coordinated attack—or just market mania? 🤯 25:56 What happened to smaller market makers when liquidity vanished 💥 29:44 How the USDe depeg on Binance triggered cascading liquidations 📊 32:16 Why Ethena “managed it well” and why exchanges don’t ADL their positions ⚠️ 34:04 What caused the USDe “depeg” 🔧 35:22 How infrastructure failures made price feeds unreliable 🚨 37:28 What perps exchanges need to change going forward ⏳ 43:56 Why Diogenes thinks this kind of crash will happen again—and worse 📜 50:20 The “extraordinary rights” LPs hold on exchanges 💱 49:02 How traders should decide where to trade after this 👀 52:19 A rumor about how much Jump lost Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

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0:00.0	I think it's something like 10 times worse than the FTX collapse, which is pretty astounding if you think about it.
0:06.6	I haven't seen anything this aggressive since then.
0:10.4	The amount of money that all of these traders in theory were kind of not cheated out of, but were unable to realize this kind of mind boggling.
0:18.4	The infrastructure in crypto just failed.
0:25.4	Hi, everyone.
0:26.7	Welcome to Unchained.
0:28.4	You're no-hype resource for all things, crypto.
0:30.3	I'm your host, Laura Shin.
0:34.8	Aptos is the no-compromise infrastructure for global financial markets,
0:39.1	fast, reliable, and 100 times more cost-efficient than other blockchains. See for yourself why Aptos is the chain of choice for institutions, users, and
0:44.9	developers alike at the Aptos Experience, October 15th and 16th in Brooklyn.
0:50.6	I'm here with Dio Casares, founder of Clear Protocol and advisor at Patagon Management.
0:55.8	Welcome, Dio.
0:57.0	Thanks, Laura.
0:57.8	Good to be on.
0:59.3	So, obviously, we're about 24 hours after a crazy set of events in the crypto market that all kind of happened in the span of, I don't know, like 20 minutes.
1:11.6	You've read a great timeline of the events before and after this Black Friday crash in which we saw $19 billion in liquidation occur.
1:19.6	So tell us the story of what led up to that moment and then what happened during the crash.
1:25.6	Yeah.
1:26.6	I mean, at the start, there was already kind of rumblings that something could happen.
1:33.3	On Thursday, China had announced any products being exported from China with a certain amount.
1:39.8	It was literally like 0.1% containing like Chinese rare earth materials would need government,
	...

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