According to Charlie Erith, Founder of Wiston Capital, the October 10 cryptocurrency market crash was a rapid, leverage-driven collapse that severely impacted altcoins while Bitcoin demonstrated relative stability. The future market direction depends on several key technical indicators.
In his "Crypto Crumble" analysis, Erith reported that excluding Bitcoin, Ethereum and stablecoins, the crypto market plummeted approximately 33% within 25 minutes on October 10 before recovering to a 10.6% loss. Total cryptocurrency market capitalization has declined by $560 billion (13.1%) since October 6, with $18.7 billion in liquidations during the crash.
Erith identified President Trump's threat of additional tariffs on Chinese imports as the immediate trigger, though he noted market weakness was already evident. While equities continued climbing, cryptocurrency markets appeared "distinctly frail," creating a divergence that served as an early warning.
Bitcoin performed "largely as expected," declining less significantly than altcoins and maintaining its long-term uptrend from late 2022. Bitcoin's market share increased as alternative tokens suffered "immense technical damage." Erith's fund emerged "largely unscathed" due to defensive positioning.
Critical Market Signals to Monitor
Erith is tracking Bitcoin's 365-day exponential moving average as the boundary between bullish and corrective regimes. A pullback toward $100,000 that maintains this level wouldn't alter his long-term outlook, but a sustained break could signal deeper market reset.
Bitcoin dominance serves as another crucial indicator. The crash accelerated rotation toward high-liquidity assets, boosting Bitcoin's market share. Continued dominance growth alongside weak market breadth suggests caution toward high-beta tokens until altcoin charts recover.
Strategy's equity performance provides leverage and sentiment insights. Erith noted that four years ago, breaking below its 365-day average preceded significant Bitcoin declines. Maintaining above this trend supports resilience, while breaking below could indicate renewed selling pressure.
Volatility measurements complete the analysis. The VIX "fear index" has begun climbing, with historical data suggesting better entry points occur during volatility spikes rather than initial increases. This framework recommends patience before adding risk exposure.
Erith maintains investment positions but avoids leverage, holding cash "waiting for the dust to settle." His experience suggests such moves sometimes precede broader downturns, justifying caution until signals stabilize before increasing market exposure.
The analyst concluded that while altcoins suffered substantial damage, Bitcoin's modest decline comparable to large-cap tech stocks demonstrates growing cryptocurrency market resilience.