Digital Asset Treasury (DAT) companies that bet on rising altcoin prices lost billions in October, after a swift collapse between 11 and 13 October 2025 wiped out open positions and forced exchanges to close leveraged bets. The shock rippled across traders, company treasuries and large issuers, exposing how borrowed money and heavy derivatives use can turn small sparks into large fires. Reports cast doubt on business models that lean on smaller coins amid these dynamics.
Prices dropped fast between 11 and 13 October 2025, with the episode a “reckoning” for DAT firms because most of the pain sat in altcoin books. Numbers indicate exchanges closed about nineteen billion dollars of positions, while some coins lost forty percent in minutes.
The first spark came from fresh trade threats between the United States and China, which pushed traders to sell. Once preset rules on exchanges triggered, bots sold more, turning automatic liquidations into a self-reinforcing slide.
After the plunge, Bitcoin climbed back above one hundred fourteen thousand dollars, and altcoins partly bounced, adding roughly one hundred thirty billion dollars to their total value in one day. Even so, the wild swings show the market stands on brittle ground and similar drops could follow the next bout of bad geopolitical news.
The keys to DAT after the October adjustment
Liquidity and leverage risk emerge when a DAT keeps most of its coins in altcoins; if loans come due during a sell-off, it must sell into a falling market, and those forced sales lock in large losses.
Derivatives and liquidation rules amplified the move as exchange bots sold positions automatically once prices crossed preset levels, feeding on themselves and deepening the fall.
Volatility for treasuries and big funds spiked to a degree that breaks normal risk plans and scares large investors away, even though some still talk of an “ETF Altcoin Season.”
Signal for regulators strengthens as the crash gives lawmakers fresh reason to set stricter caps on borrowing and to watch how crypto treasuries operate.
A Digital Asset Treasury (DAT) company holds a pool of crypto coins for itself or for clients, and often parks part of that pool in smaller altcoins to earn extra return or to borrow against the holdings.
October 2025 delivers a clear lesson: politics, borrowed money and automatic selling rules can drain liquidity in minutes, and both DAT firms and outside investors feel the pain. The next watch point is whether U.S.-China trade talk heats up again and whether that sparks fresh forced sales and scares big funds away.
