Cathie Wood's Ark Invest drops a blunt message on crypto crash

Cathie Wood‘s asset management firm ARK Invest shared its opinion on the Oct. 10 crypto meltdown.

The firm, in its weekly newsletter, reflected back on the crypto blood bath that caused the biggest market liquidation since the pandemic. When U.S. President Donald Trump warned on Truth Social to impose a 100% tariff on Chinese goods, as a retaliation to China’s plans to weaponize access to rare earth metals, it ignited a wave of panic selling across global markets.

Amid the wreckage, ARK Invest CEO Cathie Wood delivered a blunt message: “Above all, the day served as a reminder that this new asset class is still nascent.”

Ahead of Trump’s comments, Ark Invest observed that a mysterious trader or group had quietly amassed sizable short positions on Hyperliquid, an on-chain perpetuals exchange. When traditional markets responded, those shorts helped spark a wave of liquidations that cut Bitcoin (BTC) open interest from roughly $67 billion to $33 billion and Ethereum (ETH) from $38 billion to $19 billion.

Ark Invest wasn’t alone in flagging the move. On Oct. 11, on-chain analyst @mlmabc also reported that a trader on Hyperliquid shorted BTC and ETH during the drop, closing positions and pocketing more than $160 million in profit within a day.

Related: Markets reel despite Trump’s U-turn on China 100% tariff

The analyst added on X that the trader had closed 90% of their BTC short and fully exited their ETH short, netting between $190 million and $200 million in just 24 hours. The trader reportedly opened another nine-figure short in BTC and ETH minutes before the liquidation cascade.

The rapid sell-off across digital assets resulted in over $7.5 billion in leveraged positions being wiped out within an hour, with $6.22 billion from longs and $1.29 billion from shorts.

Over the next 24 hours, total liquidations surged past $19 billion, affecting roughly 1.67 million traders and erasing positions led by Bitcoin, Ethereum, Solana (SOL) and XRP.

One of the largest single liquidations totaled $87.53 million on HTX’s BTC/USDT pair. The massive cascade pushed major exchanges like Coinbase and Binance into crisis mode.

This story was originally reported by TheStreet on Oct 20, 2025, where it first appeared in the MARKETS section. Add TheStreet as a Preferred Source by clicking here.