Bitcoin between October 2025 and the return of volatility: what happened and what to expect

October 2025 was supposed to represent the classic “Uptober,” the historically favorable month for cryptocurrencies. Instead, it became synonymous with one of the most devastating crashes of the last decade, with Bitcoin experiencing a particularly violent contraction. To consider the magnitude of the shock, the numbers speak for themselves: from the $124,000-$126,000 range reached in the early days of the month, to the collapse that wiped out about one-third of the total value and over $1 trillion in market capitalization by the end of November.

The October Deleveraging Event: When the Market Lost Control

The peak tension occurred over the weekend between October 10 and 12. In just a few hours, the situation shifted from normal volatility to full systemic panic: Bitcoin plunged below $105,000, Ethereum recorded losses of 11-12%, and many altcoins suffered drops between 40% and 70%, with some flash crashes nearly wiped out on low-liquidity pairs.

What happened goes far beyond a simple technical correction. It was a massive deleveraging event that exposed the structural vulnerabilities of the market. Statistics confirm the scale of the shock: between October 10 and 11, leveraged positions estimated at between $17 billion and $19 billion were liquidated in less than 24 hours, involving about 1.6 million traders worldwide.

The Real Causes Behind the Collapse: Macro, Geopolitics, and Excess Leverage

The immediate trigger was external to the crypto world but had devastating consequences. The surprise announcement of tariffs up to 100% on Chinese imports triggered a wave of risk aversion in global markets. Cryptocurrencies, being among the most sentiment-sensitive assets, were at the forefront: those who had built excessively leveraged positions had no time to react before automatic liquidations took over.

However, reducing everything to the tariff announcement would be incomplete. The true cause lies in a combination of converging factors. For months, the market had been pricing a delicate balance between a narrative of a super-bullish cycle and conflicting macro signals. On one side, Fed rate cuts suggested a return of liquidity; on the other, official communications remained cautious about “easy money.”

In this context, the massive use of leverage had made the system extremely fragile. When the price started to decline, the forced closure of these positions amplified the movement well beyond what geopolitical news alone would justify.

A psychological element intensified the panic. After months of discussions about Bitcoin surpassing $150,000 and a crypto market capitalization potentially reaching 5-10 trillion, many traders were convinced that the path was almost inevitable. When reality contradicted those expectations, the disconnect between narrative and actual prices turned doubt into real panic, especially among late entrants caught in full euphoria.

Possible Scenarios for the End of 2025

Looking ahead to the coming weeks, it’s useful to think in terms of scenarios rather than rigid forecasts.

Scenario 1 - Gradual absorption of the shock: The market begins to integrate the loss through slow accumulation by long-term holders and strategic rebalancing that increases exposure to Bitcoin and large caps at the expense of more speculative altcoins.

Scenario 2 - Prolonged nervous sideways movement: The market stops crashing but struggles to rebound genuinely. This is the phase where short-term traders suffer because false signals multiply and intraday volatility does not translate into medium-term direction.

Scenario 3 - New downward leg: The most feared by market participants. Bitcoin could test the $70,000-$80,000 area more decisively, while many altcoins would record depressed volumes and few positive catalysts.

The most probable reality is a dynamic combination of these scenarios: partial recoveries, congestion phases, and new waves of volatility linked to Fed decisions and geopolitical news.

What Historical Data Says About Year-End Seasonality

From a statistical analysis perspective, Bitcoin’s seasonality in the late year shows interesting patterns. Data from 2017 to 2024 indicate that November-December tend to be generally favorable, though with significant volatility year over year. Some final quarters have seen strong rallies, others significant declines, suggesting that positive seasonality is not guaranteed and remains always conditioned by the macro context.

As of today, Bitcoin is around $91,470, about 25-27% below the October peak, in a context where Fed rate cuts continue but sentiment remains cautious across the sector.

How Institutional Investors Are Responding

A new element compared to previous cycles is the structured presence of institutional capital. Many funds that in 2021-2022 approached cryptocurrencies mainly from a speculative perspective now incorporate them into broader macro diversification strategies.

Despite the October drawdown, indicators from institutional desks point more to rebalancing and hedging than to a definitive exit. This suggests that the long-term fundamentals for cryptocurrencies remain intact in institutional thinking.

At the same time, the incident has raised important questions among authorities. Discussions on frameworks for spot ETFs and stablecoins see what happened as confirmation that the question is no longer if to regulate, but how to do so without stifling innovation. Proposed measures under discussion include greater transparency on leverage, stricter risk management requirements for exchanges, and uniform reporting standards for institutional operators.

What to Expect by the End of 2025: The True Lesson

The October 2025 crash is not an ordinary chapter in crypto volatility history. It demonstrated how a political shock can propagate in minutes within a highly interconnected, globalized ecosystem still dominated by aggressive leverage dynamics.

It also reminded us that the market remains liquid and operational even under extreme pressure, and that the presence of institutional players tends to transform the past “all or nothing” approach into more gradual rebalancing processes.

For investors, the key is not to guess the exact Bitcoin price in December but to recognize the nature of this phase. There is a tangible risk of new shocks fueled by macro and geopolitical uncertainty. At the same time, there are signals that the crash has accelerated natural selection among solid projects and pure speculation that the market had been delaying for some time.

Cryptocurrencies remain a high-risk asset, where leverage must be managed with extreme caution, especially when the macro environment is complex. Volatility is not a deviation but a structural component of the crypto cycle. Those who choose to stay in the game must do so with a clear horizon, rigorous risk management, and awareness that moments like October 2025 will continue to occur.