"Once the envelope was burnt, that was it. No one jumped down."
The inquest into the January 7, 2012 accident is being held before Coroner Peter Ryan in Wellington.
Mr Peters also told the inquest about the moment young couple Alexis Still, 19, and Chrisjan Jordaan, 21, jumped from the basket to escape the fire.
"I saw that she was tumbling when she was falling to the ground," he said.
"I then saw a male jump out the basket as well. He jumped feet first."
Graphic details about the wreckage, which ended up in a burnt mess in the paddock, were also revisited.
"I could still see several bodies in the basket while it was burning," Mr Peters said.
Throughout Mr Peters' evidence, several members of the public gallery - which has been filled with supporters and family members of those involved in the crash - burst into tears.
A previous crash report from the Transport Accident Investigation Commission had already established errors made by Mr Hopping ultimately led to the balloon's demise.
Toxicology results also showed he had cannabis in his system at the time, and impairment from the drug could not be ruled out as being a factor in the mistakes he made.
Mr Peters also commented on pre-flight briefings for passengers and regulations around power lines and flying.
He said he did not support including large amounts of detail around possible emergency situations, as it could result in passengers becoming "scared" and lead to unnecessary distractions for the pilot if people started pointing out hazards which weren't really risks.
When the crash occurred, Mr Hopping had flown into a paddock bordered on two sides by power lines. After descending to a height of about 7 metres, Mr Hopping was increasing the balloon's altitude when a change in wind direction blew it sideways into one of the sets of power lines.
Lawyer Grant Burston, who is assisting the coroner, asked Mr Peters whether he thought a rule making it illegal for commercial balloon pilots to put people at risk by flying too close to power lines should be in place.
Mr Peters said a rule around power lines and flying could be useful.
"There should be something in place. I can't really comment on that but I don't think the wind is as variable as people say. I think it was just a rogue gust that took him by surprise."
The inquest, which is in its fourth day, continues.
