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On October 10-11, perp DEXs liquidations dominated headlines as the crypto market faced $19 billion in sell-offs, the largest since FTX’s collapse. Despite the turmoil, leading perpetual DEXs and DeFi lending platforms maintained stability across global decentralized exchanges, proving their resilience.
Massive margin calls and liquidations tested traders and protocols alike, yet strong collateral, careful risk management, and conservative ETH valuations prevented a cascading market collapse, highlighting how DeFi has matured and strengthened compared to previous crashes.
Despite widespread panic, DeFi platforms managed to limit losses.
According to Cryptopolitan, “The DeFi sector absorbed the October shocks with relatively controlled liquidations, demonstrating the ecosystem’s growing maturity.”
Strong collateralization, such as tokenized T-bills and reliable stablecoins, played a key role in reducing risk exposure and maintaining market stability amid perp DEXs liquidations.
Initially, perp DEXs liquidations caused open interest to drop over 50%, falling from $25.75 billion to $13.71 billion.
“Within a few days, open interest again exceeded $17 billion, indicating a return of trader confidence despite the recent liquidation,” DeFiLlama reports.
Retail traders bore the brunt, with many losing heavily on leveraged positions.
After the liquidation shock, value locked on perp DEXs rebounded from $13 billion to $17 billion, reflecting strong market recovery. Platforms like Hyperliquid recorded $8.24 billion in open interest, after earlier lows of $6.24 billion.
Daily trading volume exceeded $33 billion, while weekly trading reached $264 billion between October 6 and 12, underscoring robust engagement in the DeFi market even after perp DEXs liquidations.
The liquidation event occurred during peak trading, with both new and established perp DEXs seeing record activity.
On-chain liquidations highlighted risks for leveraged retail traders, yet the market remained active, demonstrating the sector’s resilience and adaptability.
Top perp DEXs tokens experienced weekly declines of 16%–45%. For instance, HYPE fell to $38.71. Despite this, continued recovery in value locked, open interest, and token values signals that long-term confidence in perp DEXs remains intact, with investors steadily pursuing their strategies post-liquidation.
DEX trading hit $177 billion in weekly volume from October 6-12, marking the largest surge of the month.
Platforms like Uniswap and PancakeSwap remained stable, benefiting from higher trading fees, further proving the DeFi ecosystem’s robustness during perp DEXs liquidations.
Lending platforms faced pressure due to debt exposure. Led by Aave, total value locked stayed above $83 billion, while borrowed amounts fell below $50 billion.
Conservative yields, such as Lido’s stETH at 7.05%, indicate sustainable returns while minimizing liquidation risks, complementing the recovery from perp DEXs liquidations.
Reliable collateral, including ETH at conservative price levels, limited losses. ETH’s liquidatable value stayed just under $1 billion, with token prices at $1,548—well below market rates—preventing further cascading liquidations and panic during perp DEXs liquidations.
Traders remain cautiously optimistic. As DeFiLlama notes, “The recovery in open interest and record trading volumes indicate that decentralized exchanges are better prepared for future market shocks.”
Additionally, a Hyperliquid analyst remarked, “Despite losses, traders remain committed to long-term strategies in perp DEXs.” The October perp DEXs liquidations event has set a benchmark for risk management improvements in DeFi.
In conclusion, the October 10-11 market shock highlighted both risks and resilience within DeFi. Perp DEXs liquidations caused temporary disruption, but strong protocols, reliable collateral, and strategic trading quickly restored stability, showcasing a maturity not seen during previous crashes and reinforcing confidence in the decentralized finance ecosystem.
