What started as a lighthearted day of pranks internationally took a dire twist in the world of cryptocurrency. On April 1st, 2025, there was a notable sell-off for a multitude of altcoins and memecoins, resulting in a cascade of traders lacking context or cohesive reasoning regarding the volatility. There is much speculation around the trading of these coins.
ACT Token’s Dramatic Collapse: A 58% Plunge
The greatest price change was registered with Act I The AI Prophecy (ACT), which is a token tied to an AI project. Its price also started to nosedive and its value dropped from $0.19 to $0.08 within a matter of minutes. Motivated traders suffered a great loss due to $96 million that was drained from ACT’s market cap in this time, with most financial backing being through the tokens market value. The data offered by CoinMarketCap aided in tracking the massive ACT collapse, which was expected to cause profound disownership.
A Sea of Red: Altcoins and Memecoins in Freefall
It wasn’t just the ACT token that was suffering from this unprecedented meltdown. Altcoins also fall victim to the suffering tokens after markets crash, most dynamically the range of shifts from heroic to villainous hyper memecoins. Other harder hit coins included Sudeng (HIPPO), CZ’s Dog (BROCCOLI), Kishu Inu (KISHU), and also DeXe (DEXE) and dForce (DF), which saw the most losses in potency and growth and contributed heavily to the memecoin and volatility frenzy.
Bitcoin’s Resilience: A Calmer Fragment Amid a Choppy Sea
It is peculiar that Bitcoin (BTC) has, to a certain extent, maintained its value in contrast to most altcoins plummeting in price. It seems like a level of controlling selling pressure occurred only in certain parts of the market, and older, more reliable assets escaped unscathed.
Act I’s Response: Attempts to contain the fire and look into the issue
The AI Prophecy Act I team posted on X and eased their community’s concern by stating that they were, in fact, “actively investigating” the situation that caused the price dip. It was noted that they were working together with, in their words, “all pertinent stakeholders” to come up with a mitigation strategy to contain the adverse consequences stemming from the issue.
A Possible Source of the Market Unrest: Binance’s Margin Change
As always, speculation reigned supreme, and many looked at various sources and concluded Binance, one of the largest crypto exchanges, was responsible for the market instability. Lookonchain, a blockchain analytics site, noted Binance’s changes in leverage and margin for certain tokens, including ACT, on April 1 are believed to have caused massive liquidations by traders deemed “whales.” A whale was noted by Lookonchain as being liquidated for 3.79 million dollars at an ACT price of 0.1877 dollars.
Binance’s Investigation: Preliminary Findings
In a bid to calm the concerns, Binance made a public blog post regarding their internal analysis on the price volatility the ACT token experienced. The exchange reported that their analysis revealed “three VIP users sold ACT tokens worth approximately 514,000 USDT on the Binance spot market,” and a non-VIP user sold a spot ACT token for approximately 540,000 USDT as well. Yet, Binance still stated, “We have not identified any single account that made considerable profits out of this incident.”
Wintermute Speculation: Denials and Regrets
With the complexity, some market participants raised the possibility of the altcoin position liquidation being done by Wintermute, an international algorithmic trading firm. However, comments were mostly directed towards Wintermute co-founder and CEO Evgeny Gaevoy, who is known for defending the company’s reputation on social media. During the exchange, he boldly stated, “Not us [for what it’s worth], but also curious about that postmortem.” The X user that made those claims later on came back to express remorse for their comments and admitted that Wintermute has had a positive impact on the market.
A Chaotic April Fools’ Day: Exploring the Unexplained
The cryptocurrency market events on April 1st are still not very clear. Even though Binance’s margin update seems to have contributed to the liquidations being triggered, the case is still open in terms of how deep the impact was and how other factors may have contributed.
The sharp price movements underscore the risks associated with the altcoin market and underscore the need for careful consideration by traders.
