Despite a roaring start and a fresh all-time high early in October, the anticipated “Uptober” turned into a real downer for Bitcoin. The leading cryptocurrency sank to levels unseen in four months, disappointing many investors.
According to CoinGecko, Bitcoin’s price recently stood at $109,820 per coin—about 13% below its October 6 record of $126,080. Over a 30-day period, the asset is down by more than 8%.
Historically, October has been one of Bitcoin’s strongest months, earning the nickname “Uptober.” Data from CoinGlass shows that over the past 10 years, there has been only one monthly loss in October, back in 2018. However, this October broke a six-year streak of gains, showing a 3.69% drop from the start to the end of the month.
The plunge during this traditionally strong month coincided with unsettling macroeconomic conditions. These include concerns about liquidity and diminishing prospects of a third interest rate cut that investors had been eagerly anticipating.
On Wednesday, U.S. Federal Reserve Chair Jerome Powell stated that a rate reduction was “not a foregone conclusion.” This announcement sent digital assets into a tailspin, causing Bitcoin’s price to dip below $106,000 at one point.
Earlier in the month, Bitcoin and other risk-on assets tumbled after U.S. President Donald Trump re-escalated his trade war with China, raising further concerns about the global economy. As a result, investors liquidated more than $19 billion in positions, with nearly 90% of them being long positions anticipating price increases.
Juan Leon, Senior Investment Strategist at Bitwise, told Decrypt that the negative October returns could be attributed to a convergence of three primary factors: a powerful macroeconomic shock, a fragile internal market structure, and a subsequent lukewarm monetary policy signal. He added that the crash on October 11 had a long-term effect on the market.
In her “Crypto is Macro Now” newsletter, analyst Noelle Acheson wrote that “the reset of rate cut expectations” continued to weigh on cryptocurrency prices. She noted Powell’s acknowledgment that liquidity conditions have been tightening. While liquidity isn’t yet near crisis levels relative to bank reserves, Bitcoin remains one of the more sensitive assets to these liquidity changes.
Acheson explained, “Equities have earnings and other factors impacting their appeal, and bonds have fiscal and economic growth. Bitcoin doesn’t—it’s pure sentiment, which in the short term is affected by monetary liquidity and in the long term by the supply/demand balance.”
Earlier in the week, in a Telegram exchange with Decrypt, Acheson also pointed out increased selling by long-term Bitcoin holders. This trend could reflect their belief that Bitcoin has peaked in its latest four-year cycle—the timeframe historically defining crypto market rhythms.
She wrote, “If you still believe in the BTC four-year cycle (and many old-timers probably do), then we’re at the peak if you map previous cycle patterns.”
Bitcoin, cryptocurrencies, and stocks have typically performed well in a low-interest-rate environment. The Federal Reserve has cut rates in its last two meetings. Historically, Bitcoin climbed nearly 11% last October and almost 29% in October 2023. In 2021, it surged a whopping 40% during the same month. On average, the digital coin has delivered investors returns of nearly 20% in October, according to CoinGlass.
“This makes this feel like one of the weakest ‘Uptober’ performances in years,” said pseudonymous CryptoQuant analyst Maartunn in an interview with Decrypt. He noted that the decline was not the result of a single broad selloff but largely driven by selling during U.S. trading hours. Additional factors included China tariffs and unfavorable economic data such as unemployment figures, consumer price index, and producer price index readings in recent months.
Despite the struggles, some analysts remain optimistic. Zach Pandl, Head of Research at Grayscale, told Decrypt that the long list of cryptocurrency exchange-traded funds (ETFs) the SEC is expected to approve could provide support to the market. He also highlighted that the regulatory environment remains favorable for digital assets.
“With bipartisan market structure legislation back on track and several altcoin exchange-traded products set to launch, we expect that the crypto market setback will be short-lived,” Pandl said.
So, will it be “Moonvember” for Bitcoin? Last year, November brought an impressive 37% price spike for BTC—something investors would no doubt be thankful to see again. Only time will tell if November can deliver a strong rebound after a disappointing October.
https://decrypt.co/347060/red-uptober-why-bitcoin-worst-october-years
