The sharp crypto selloff that began on October 10 was not just another bout of volatility.
According to Frank Holmes, executive chairman of Hive Digital Technologies, the scale of liquidation may help explain why markets have struggled to find a clear bottom.
During a recent interview with TheStreet Roundtable, Holmes said the magnitude of losses far exceeded previous crypto crises, including the collapse of FTX.
“This is much bigger than FTX,” he said. “It’s a magnitude of loss of six times. With FTX, a lot of the money was eventually found and came back into the system. This time, it’s just gone.”
Holmes framed the event through the lens of earlier market crashes. He recalled living through the 1987 stock market collapse, when early portfolio hedging strategies using futures unintentionally amplified selling.
“It became self fulfilling,” he said. “Down one percent, sell ten times the size. Down another one percent, sell another ten.”
The result was a global shutdown of markets and widespread economic damage beyond finance.
That historical perspective shapes how Holmes thinks about crypto recoveries. In past cycles, he said, the timeline to bottom depended on how much capital was permanently destroyed. When China forced miners out, the market found a trough in about three months. After FTX, it took roughly two to three months. October’s liquidation, however, removed far more capital from the system.
“A lot of hedge funds got tapped out,” Holmes said. “They leveraged their portfolios, tried to run delta neutral strategies, and it’s all gone.”
Holmes initially expected a bottom by mid January, roughly three months after the selloff. Instead, new pressure emerged. Rising Japanese bond yields triggered what he described as a $500 billion unwinding of the yen carry trade, adding fresh selling throughout January.
Despite that, Holmes said signs of stabilization may finally be forming. “We should be looking to find a bottom here,” he said, noting the seasonal timing around mid to late February.
Still, he cautioned against overconfidence. Market cycles do not follow precise schedules. For now, Holmes still sees October 10 as a defining event not because it caused panic, but because it erased capital in a way that takes longer to rebuild.
This story was originally published by TheStreet on Feb 23, 2026, where it first appeared in the MARKETS section. Add TheStreet as a Preferred Source by clicking here.