On Tuesday, November 3rd, the crypto market witnessed a large-scale forced liquidation of margin positions in the early trading session. Within the past 24 hours, a total of 94,997 traders had their positions forcibly liquidated, with a total amount of $386.42 million. Of this, 88% of the losses ($339.92 million) came from long positions. Bitcoin and Ethereum led in terms of the scale of forced liquidations, at $100.74 million and $49.31 million respectively. The data is from CoinGlass.

The US spot ETF market also continues to show a clear bearish bias: Bitcoin funds experienced a net outflow of $398.62 million in a single day, with Fidelity's FBTC seeing an outflow of $164 million. Over the past day, 44,857 ETH were withdrawn from spot Ethereum ETF. SoSoValue data shows that the total managed asset size ( AUM ) of all cryptocurrencies ETF is $95.83 billion.

The current daily capital outflows have spread across the entire exchange's product line: SOL funds have seen an outflow of 129,190 tokens, XRP products have seen an outflow of 128,540 tokens, and funds specifically tracking HYPE and ZEC have seen outflows of 85,070 tokens and 13,530 tokens respectively. Major institutions are withdrawing liquidity from instruments with higher volatility in advance of the U.S. mid-term elections.

Against the backdrop of declining market value, there is a clear divergence among market participants: retail investors are locking in losses on a large scale, while most of the "whales" are betting on further declines. However, there are also some large-scale traders on the blockchain taking aggressive counter-trend positions on decentralized exchanges.

The focus in the early hours of that day was on a large trader with an unknown identity on the Hyperliquid platform. Despite the overall weakening of the market (with NEAR falling to $3.79 and BNB falling to $697.67), this trader stubbornly held a long position in XRP worth tens of millions of dollars, making this contract the main indicator of the resilience of the local altcoin.

$44 million bet: How a giant investor defended XRP during a market downturn

Decentralized futures platform Hyperliquid is currently attracting record-level institutional trading volumes. Meanwhile, on-chain analysis of top wallets with balances of $1 million and above shows that the open positions are significantly short.

These wallets collectively hold an open position of $4.5 billion, of which short contracts account for $3.08 billion, while the long position is only $1.46 billion.

Large addresses holding positions of $50 million or more are almost unanimously betting on a further decline in the market. Against this pessimistic backdrop, the long positions of the wallet “0x31b1ecf848443472e34d204a134812d86ab01434” remain the largest and highest-risk counter-trend positions in the system.

This whale holds 35.03 million XRP. Calculated with a 10x full-position leverage, the nominal value of the unfixed positions is 44.05 million US dollars.

The average entry price was $1.1298. At the high point of the morning session, the unrealized profit on this position once exceeded $4.47 million, which is equivalent to a net return of over 101% of the invested margin capital.

However, the overall performance of this account is not ideal: due to fluctuations in total assets, the net profit and loss of this wallet over the past 30 days has decreased by $8.45 million.

The key threshold in this story is still the forced liquidation price. The automatic liquidation threshold is set at $0.9626.

The current market price of XRP is around $1.2558, which means traders still have a buffer of about 23% before reaching the liquidation price.

The XRP positions of large wallets on Hyperliquid are also predominantly short. The total value of long positions is 55.7 million US dollars, while short positions amount to as high as 80.93 million US dollars. Nearly 80% of the long positions belong to the same giant whale investor.

$15 billion evaporated in a week: Infrastructure shocks, announcements, and new threats

This morning's news indicates that the entire market infrastructure is undergoing a large-scale and painful reorganization. The core issue remains the severe liquidity crisis faced by centralized exchanges.

In response to the $6.3 billion Binance hack incident and the statements made by FBI, the institution has officially attributed this attack to a North Korean national-level cyber unit. Lawyers from Reed Smith and Lathrop GPM have analyzed that the exchange's insurance policy does not cover such losses. Standard D&O insurance only protects senior management, and the exclusion clause regarding wars completely rules out any compensation in the event of cyber warfare initiated by foreign countries.

Record $15.4 billion in capital outflows: Binance experienced a record net capital outflow this week. This amount exceeds the reserves of Bybit and Bitfinex individually, as well as the combined balances of Gate, Bitget, and KuCoin. As a result, the price of BNB remains at a local low.

Zhao Changpeng, the founder of Binance, made a strong statement regarding the increased risk to financial systems due to automated cyberattacks on the AI network. This stance comes at a time when related incidents have occurred at the exchange he founded, highlighting the limited effectiveness of traditional defense mechanisms in the face of coordinated cyberactions. Zhao Changpeng emphasized that due to the outdated architecture of the IT, commercial banks are more vulnerable than cryptocurrency platforms.

In this context, decentralized protocols are steadily expanding their influence among institutions. The annual revenue of Hyperliquid has reached $713 million, and the trading volume of stocks and commodity perpetual contracts through HIP-3 has exceeded $500 billion. Based on these technologies, the operators of the New York Stock Exchange, ICE and Kraken, with the support of the White House, are preparing to launch regulated futures products in the United States.

At the same time, the largest L1 ecosystem is also undergoing significant changes. The participants of NEAR Protocol's House, of, and Stake approved a deflation proposal with a 99.96% support rate, reducing the annual inflation rate for the next 24 months from 2.5% to 1.6%. The daily token issuance will be cut from 89,500 to 57,300, and during a period of overall market decline, the asset price dropped to $3.79.

Doubts within the Ripple camp are also on the rise: The company claims that the issuance of its US dollar-stabilized coin RLUSD has exceeded $1 billion through cooperation with trust banks, but holders of XRP have publicly expressed dissatisfaction. RLUSD is a centralized asset subject to US laws and can be frozen, while the decentralized nature of XRP has not yet been reflected in market valuations.

At the same time, the Ethereum Foundation has launched a platform for governments to use this network as a digital public infrastructure ( DPI ). Relevant cases include Bhutan's digital identity and confidential humanitarian assistance systems. At the Devcon 8 held in Mumbai, Vitalik Buterin called for the development of verifiable code to minimize dependence on closed-source software and AI systems.

What's next: Key indicators to watch and the schedule of the US macroeconomic storm

In the coming trading days, the flow of funds in the crypto market will be largely determined by external macroeconomic and political factors. Investors and market makers need to pay close attention to the following key factors:

• U.S. Midterm Elections: The main political factor this Tuesday has prompted large funds to close out their margin positions in advance, reduce leverage, and hedge risks amid changing regulatory environments.
• Official JOLTS Labor Market Report: The job vacancy data released on Tuesday will determine the short-term trend of the US Dollar Index and will directly affect the liquidity of high-risk assets.
• ISM Non-manufacturing Business Activity Index: Data on Wednesday will reveal the true state of the U.S. economy and affect the medium-term sentiment of large futures market participants.
• The Federal Reserve's balance sheet and Friday's non-farm payroll report: The most critical macroeconomic factors of the week will determine the final direction of capital flows by the end of this month.