Crypto traders blame Wintermute for weekend of liquidations

As crypto prices fell 7% over the past seven days and market capitalizations shed hundreds of billions of dollars, investors looking for a scapegoat found their perfect target in Wintermute.

Wintermute is a market maker, hedge fund, quant shop, and liquidity provider on large digital asset exchanges like Binance.

When a customer sets a stop-loss order on a leveraged-long product, Wintermute can benefit from taking the other side of the trade if a crypto price decline causes a liquidation of that stop.

Bemoaning billions of dollars in alleged stop-loss liquidations, traders pulled quotes from Wintermute quants about their shocking profits.

When markets crash, traders often look to blame quantitative traders, arbitrageurs, market makers, and other sophisticated participants. This skepticism dates back to at least April 30, 2018, when BitMEX CEO Arthur Hayes admitted to operating a secret, for-profit, second business on his own exchange that profited from his customers’ liquidations.

Although BitMEX is no longer the world’s most liquid crypto exchange, modern traders are complaining about the leading incumbent, Binance.

Wintermute has transferred hundreds of millions of dollars’ worth of assets with Binance where it takes advantage of leverage and customer liquidations. 

Billions of dollars in weekend crypto liquidations

Earlier this morning, bitcoin (BTC) dropped to $91,300 before rebounding over $98,000. Ethereum (ETH) plummeted by almost 15% in a 24-hour period, dropping as low as $2,160 before recovering slightly. Solana briefly crashed from $212 to $176. 

By this morning, Bybit estimated total 24-hour liquidations across all crypto exchanges at $8-10 billion, more than Coinglass’ $1.9 billion estimate. Liquidations on the Bybit exchange alone totaled $2.1 billion.

For his part, Wintermute CEO Evgeny Gaevoy denied rumors that his traders were purposefully running stops on Binance customers or purposefully causing liquidations on other digital asset exchanges.

Read more: The history of crypto exchanges trading against their own customers

Wintermute CEO says he didn’t run the stops

The Wintermute CEO denied knowingly being involved in any market manipulation, mentioning how much he would dislike having to live in Dubai or go on the run.

He says any transfers mentioned today on social media were just Wintermute’s normal business transfers — moving assets between exchanges as part of its market-making and liquidity-providing activities.

Gaevoy did mention that Wintermute takes discretionary, short-term trades. He also admitted to delta-neutral trading involving sales on Binance with simultaneous buying on over-the-counter (OTC) markets.

Wintermute recently reported that its trading volume on OTC exchanges increased by 313% in 2024. Naturally, some commenters jumped on that admission, accusing Wintermute of price suppression.

Gaevoy scoffed at investors blaming Wintermute, rather than broader market forces, for this weekend’s digital asset price drops. Donald Trump’s tariff announcements caused a multi-hundred billion dollar weekend sell-off in the S&P 500 alone.

Increasing inter-market correlations

As crypto has gained prominence, digital asset prices increasingly correlate with other markets. The S&P 500 opened for trading today nearly a full percentage point lower than Friday’s close, and blue chip companies like Apple, Nvidia, Tesla, and Blackrock have lost more than 3% of their market cap since Friday.

Did Wintermute or Binance deliberately contribute to the drop in digital asset markets or purposefully liquidate billions of dollars in long positions? Although social media blamed money managers like Gaevoy, Wintermute denies that its activities this week are anything but its normal market-making and liquidity-providing activities.

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