BitMEX says the era of easy money via arbitrage trades likely died in the October crash, as a liquidation spiral left many market makers naked.
The massive crypto crash in October decimated market makers, ending an era where crypto traders were able to make easy money, says crypto exchange BitMEX.
The crash between Oct. 10 and 11 wiped out $20 billion in the “most destructive event for sophisticated market makers in crypto history,” BitMEX said in its State of Crypto Perpetual Swaps in 2025 report released on Thursday.
A feedback loop of auto-deleveraging, where exchanges liquidate profitable, leveraged positions to cover themselves and prevent further losses, broke the market makers’ “‘safe’ delta-neutral strategies,” forcing them to pull liquidity and leave orderbooks at multi-year lows, BitMEX said.
