Rumors Lack Credible Evidence
Evgeny Gaevoy, CEO of Wintermute, recently expressed strong skepticism toward circulating market rumors of a major institutional liquidation. He emphasized that while similar events have occurred historically — such as the collapses of 3AC and FTX — those cases were accompanied by clear and rapid signals of distress. Currently, no such indicators are present.
Most of the current rumors stem from anonymous accounts lacking credibility. Gaevoy pointed out that real institutional liquidations typically require excessive leverage, which in this cycle is mainly concentrated in the perpetual futures market — a segment with more structured risk controls compared to previous cycles.
Improved Risk Management Framework
During the last downturn, leverage was largely fueled by unsecured loans from platforms like Genesis and Celsius, leading to opacity and systemic fragility. In contrast, the current market structure is more transparent, with exchanges implementing significantly better margin management systems.
Gaevoy also noted that the likelihood of exchanges once again misallocating customer funds into illiquid assets — as seen during the FTX collapse — is now much lower. The primary risks facing the industry today are limited to cybersecurity threats and client liquidations under extreme volatility, both of which have been mitigated through mechanisms like Auto-Deleveraging (ADL).
Legal Risks Cannot Be Ignored
Additionally, he warned that if a firm were already insolvent yet continued to publicly deny bankruptcy, it could face severe legal repercussions in jurisdictions such as the U.S., Europe, and Singapore. This further implies that there is currently no substantial evidence pointing to systemic risk in the market.