A sharp weekend reversal swept through digital asset markets after on-chain data revealed that Wintermute, one of the industry’s largest market makers, had amassed a heavily short-biased position on the Hyperliquid derivatives platform. Bitcoin tumbled to $75,500 on Sunday, surrendering a chunk of the gains from its strongest weekly run in years, while Ether and XRP posted steeper losses.
Analytics platform Onchain Lens flagged the positioning late Saturday, reporting that Wintermute held roughly $160 million in open positions on Hyperliquid, with $146.19 million on the short side against just $13.85 million in longs. The combined book was sitting on an unrealized loss of $3.66 million while earning $2.14 million in funding payments. The same data showed Wintermute moved nearly $60 million worth of Bitcoin and Solana into Binance and Coinbase on Saturday, a pattern that often precedes selling.
A separate on-chain tally tracked 3,834.3 Bitcoin, worth approximately $256.8 million, flowing from Wintermute wallets into Binance over the previous week. The firm has not commented publicly on either the exchange deposits or its futures positioning.
The market impact was swift. Bitcoin, which had surged from roughly $64,000 on Wednesday to just under $80,000 by Friday night, slipped below $77,000 on Saturday and touched $75,500 Sunday morning before recovering to around $76,500. Ether dropped 5% to under $2,400, while XRP fell 6.5% below $1.50 after being rejected twice near $1.70. CoinGlass data showed nearly $100 million in liquidations within a single hour, with Bitcoin and Ether each accounting for about $41.5 million. Daily liquidations topped $350 million, ensnaring more than 90,000 traders.
The selloff clipped a rally that had been fueled by two Washington policy shifts. The U.S. Treasury doubled the size of its long-end bond buybacks, and President Donald Trump urged Congress to advance crypto market structure legislation at a White House event. Roughly $3 billion in short positions were wiped out on Thursday alone, the largest single-day figure in exchange records dating back to 2021. Saturday’s reversal erased $108 billion in market value over six minutes.
XRP’s Rise and the Broader Market Context
The weekend turbulence arrived even as XRP had been enjoying a standout stretch of its own. The token’s market capitalization climbed to roughly $94 billion, edging past Belarus’s projected 2025 GDP of $93.4 billion, according to World Bank figures cited by BankXRP. At a price near $1.51, XRP also overtook Intercontinental Exchange, the parent company of the New York Stock Exchange, in market valuation. Lithuania’s forecasted GDP of $95.2 billion sits just above XRP’s current level.
XRP open interest in derivatives surged from about $2.3 billion to $3.56 billion over a short period, according to market analyst ChartNerd, reflecting heavier positioning in futures and perpetual contracts. Large holders reportedly accumulated roughly 190 million XRP in a single day as the token broke out of a two-week consolidation phase. The token has also entered U.S. policy discussions, with Vice President JD Vance fielding questions during a Newsmax interview about whether digital assets like XRP could play a role in addressing national debt or future reserves.
A new working paper from the Federal Reserve Bank of Cleveland offers a framework for understanding the kind of rapid sentiment shifts that characterized this weekend’s price action. The study, titled “Do You Even Crypto, Bro? Cryptocurrencies in Household Finance,” finds that expectations about future returns explain crypto ownership better than standard demographic factors.
Researchers Michael Weber, Bernardo Candia, Olivier Coibion, and Yuriy Gorodnichenko analyzed repeated surveys of up to 25,000 U.S. households per wave. They found that a one-percentage-point increase in an individual’s expected crypto return was associated with a 0.8-percentage-point increase in the probability of owning cryptocurrency. Crypto owners expected an average 22% return over the following year, compared with 7% among non-owners.
The paper’s randomized information experiment produced perhaps its most consequential finding. In 2025, households shown Bitcoin’s previous 12-month return increased their desired crypto allocation by roughly 2 percentage points, about a 47% increase relative to the control group’s 4.3% baseline. Actual subsequent crypto purchases rose by about 2.5 percentage points. The effect was concentrated among people who said they lacked sufficient information to invest.
The authors argue this creates a feedback mechanism that can amplify volatility: “Positive returns attract new participants, which raises the price further.” They also found that crypto gains appear to be treated more like “gambling income” or lottery winnings than durable wealth. A doubling of Bitcoin’s price made a household whose entire financial portfolio was in crypto 1.4 percentage points more likely to buy a durable good, roughly a 7% increase, but the effect did not persist into everyday spending.
Market Structure and What Comes Next
Wintermute’s positioning matters because of the firm’s scale. Chief executive Evgeny Gaevoy disclosed this month that average daily trading volume has fallen from about $15 billion in 2025 to $10 billion this year. The company now plans to spend $1 billion on high-frequency trading and artificial intelligence data centers, an expansion well beyond its crypto market-making roots.
Analysts who examined Saturday’s slide argued that crowded retail leverage caused most of the damage, noting that short interest actually fell while long positions were being forced out. Open interest across the wider derivatives market dropped by $3.34 billion during the episode. The cumulative crypto market cap has declined by approximately $100 billion from its local peak to $2.65 trillion, though it remains up $400 billion since Wednesday.
For traders, the key question is whether spot demand can absorb the leveraged unwind. The Cleveland Fed paper’s warning that crypto volatility stems partly from disagreement and learning suggests that sharp reversals may remain a structural feature of the market. As the authors put it: “The absence of common information and beliefs about crypto across investors suggests that price volatility will continue to be one of the most defining characteristics of this new asset for the foreseeable future.”
Amid the broad selloff, Hyperliquid’s native token HYPE defied the trend, surging past $82 to a fresh all-time high. PUMP rallied over 17% in 24 hours, while ENA gained 8%. In contrast, TRUMP plunged 33% after its team sent additional coins to exchanges, and CRO and WLD each dropped more than 7%.