On October 10, former U.S. President Donald Trump signaled plans to impose punishing tariffs on China, triggering a global market rout. The cryptocurrency market suffered a brutal flash crash, with Bitcoin and numerous altcoins losing 50–80% of their value. An estimated $16 billion in long positions were liquidated by the early hours of October 11. Amid the chaos, a pseudonymous trader operating as Garrett Bullish amassed profits reportedly exceeding $190 million by shorting the market. The scale of the windfall instantly attracted allegations of insider trading, with some suggesting Bullish had prior knowledge of Trump's market-moving announcement.
Public Denial and Pushback
Bullish, who some online sleuths have identified as Garrett Jin, took to X to vehemently deny any connection to the Trump family. He specifically addressed claims that his trading decisions were influenced by inside information from Trump Jr. or other family members. “I have zero ties to Donald Trump Jr. or anyone associated with the administration,” he wrote. The denial came after Binance founder Changpeng Zhao (CZ) amplified public scrutiny by sharing a post that reportedly contained Bullish's personal information. The trader insisted that the accusations were baseless and promised to pursue legal action against defamatory statements.
Root Cause Analysis: Trade Tensions and Leverage
Beyond defending his reputation, Bullish offered a detailed breakdown of why the crash occurred. While acknowledging that Trump's tariff announcement was the immediate catalyst, he argued that two deeper factors were at play: escalating U.S.-China trade tensions and the extreme leverage embedded in crypto markets. “Unlike stocks, most cryptocurrencies lack an inherent value anchor—they are driven purely by sentiment, greed and fear,” Bullish explained. “When exchanges offer 5x–100x leverage on such volatile assets to retail traders, a liquidity crisis becomes inevitable, whether prices rise or fall.” He claimed his short position was based on this structural fragility, not on any non-public information. He characterized the liquidation cascade as “the worst in history” and warned that similar systemic risks remain.
Proposal for Exchange Stabilization Funds
As a remedy, Bullish urged exchanges that provide high leverage to implement a stabilization fund mechanism. Such a fund, he argued, could supply essential liquidity during crises, restore market confidence, and allow capital to flow back in, enabling the market to grow “healthily.” The proposal has sparked debate among industry participants, with some analysts supporting the idea while others question its practicality and potential for moral hazard.
As of now, no official investigation into the insider trading claims has been announced. However, Garrett Bullish's forceful denial and his focus on leverage risk have placed the spotlight squarely on the structural vulnerabilities of crypto markets—reminding investors that flash crashes and liquidations are often the result of systemic design, not conspiracy.