Hey folks, if you've been following the crypto scene, you know the past week has been a wild ride—or more like a straight-up nosedive. On October 10, 2025, the market saw its biggest liquidation event ever, with a staggering $19.5 billion wiped out in a flash. This chaos was sparked by former President Trump's announcement of 100% tariffs on China and export controls on software, sending shockwaves through the industry Trump Tariffs Upend Crypto Market. Prices tumbled, and what started as a sell-off turned into a full-blown cascade of liquidations.

This brings us to a spot-on observation from Solana Legend, a key figure in the Solana ecosystem as Co-Founder and Managing Partner at FrictionlessVC and monkeDAO. In his tweet, he nailed it: "This past week has showed that a majority of the crypto market is propped up by MM liquidity and as soon as that got pulled, there was no floor for these assets. Putting leverage on spot 80+ vol assets is crazy, that is options level of volatility without premiums or liq. risk."

Let's break this down simply. "MM" stands for market makers—those big players who provide liquidity by constantly buying and selling assets to keep the market flowing smoothly. They place bids and asks on exchanges, creating a "floor" that prevents prices from free-falling. But when volatility spikes, like during this tariff news, market makers often pull back to protect themselves from losses. Suddenly, there's no safety net, and prices plummet as sell orders hit thin air.

This is especially true for high-volatility assets, which Solana Legend pegs at 80+ vol (that's volatility, a measure of how wildly prices swing). Meme tokens, the darlings of the crypto world on chains like Solana, fit this bill perfectly. Think about it: these coins can rocket 10x in a day on hype but crash just as fast when the buzz fades. Adding leverage—borrowing money to amplify your bets—turns this into a high-stakes gamble. It's like trading options (contracts that bet on price moves) but without the built-in premiums that cushion blows or the structured liquidation risks that options have.

In the October crash, we saw exactly this play out. Exchanges faced massive sell pressure, and with liquidity vanishing, altcoins flash-crashed up to 70% in minutes Crypto Markets Reel from $19 Billion Crash. Meme tokens, often thinly traded and hype-driven, got hit hardest. For instance, posts on X highlighted how market makers withdrawing bids created "liquidity vacuums," leading to instant free-falls What really caused the crash. No conspiracy—just the harsh reality of crypto's microstructure.

For meme token enthusiasts and blockchain practitioners, this is a wake-up call. Meme coins thrive on community buzz and rapid pumps, but they're fragile without deep liquidity pools. On Solana, where low fees and speed make it a meme haven, projects like those in monkeDAO show potential, but events like this expose the risks. If you're holding or trading these, consider spot trading over leverage to avoid getting liquidated in a blink.

Looking ahead, analysts like Benson Sun suggest this was a "harsh deleveraging" but expect a bullish rebound in Q4 2025 as liquidity flows back Crypto Chaos in October 2025. The total crypto market cap (excluding BTC, ETH, and stables) held its macro wedge pattern, hinting at a potential breakout above $1T Total Crypto Market Cap. But to navigate this, focus on fundamentals: verifiable liquidity, community strength, and avoiding over-leveraged plays.

At Meme Insider, we're all about arming you with insights to level up in the blockchain space. Events like this October crash remind us why understanding liquidity and volatility is key to surviving—and thriving—in the meme token game. Stay tuned for more breakdowns, and remember: in crypto, knowledge is your best hedge.