Can Bitcoin rebound before the end of 2025? Analysis of the October crash and sector prospects

October 2025 was supposed to be a month of growth – traditionally favorable to cryptocurrencies. Instead, it became a symbol of one of the largest corrections in history. Bitcoin, which in the first days of the month was hitting new highs between $124,000 and $126,000, lost about one-third of its value by November. The cryptocurrency market capitalization shrank by over $1 trillion.

What really caused the sharp sell-off?

The weekend of October 10-12 marked a turning point. In less than 24 hours, Bitcoin fell below $105,000. Ethereum lost 11-12 percent. Altcoins experienced brutal declines – from 40% up to even 70% in more speculative segments.

Officially, the cause was political shock: the announcement of tariffs on Chinese imports by the US administration. However, that was only the trigger.

The problem was deeper. For months, the market was saturated with leveraged positions. When forced liquidations occurred, involving $17-19 billion of exposure and over 1.6 million traders worldwide, a cascade of automatic sales ensued. Algorithms accelerated the sell-off as prices broke through successive support levels. Exchanges had to manage a sudden liquidity drop.

It was a technical avalanche, not just a correction. The atmosphere began to evoke memories of the “crypto winter” of 2022 – with the difference that this time, not just one project failed, but the entire system of excessively leveraged exposures.

Macroeconomics, psychology, and market structure

The decline would be hard to understand without considering three dimensions:

Macroeconomic: Rate cuts by the Fed and asset purchase programs suggested a return of liquidity. At the same time, communications were cautious – there was no “easy money without conditions.” The market was increasingly pricing in this balance aggressively.

Psychological: After months of discussions about Bitcoin above $150,000 and the entire sector reaching a market cap of 5-10 trillion dollars, many traders believed this path was inevitable. When reality contradicted expectations, the discrepancy turned doubts into panic.

Structural: Widespread use of leverage made the system extremely fragile. A single political shock spread within minutes across the globalized ecosystem.

Where is Bitcoin now and what might happen?

As the year nears its end, Bitcoin fluctuates between $90,000 and $93,000 – about 25-27% below the peak. There are three plausible scenarios:

Scenario 1 – Gradual stabilization: Reports suggest a slow return of accumulation by long-term investors. Portfolio rebalancing increases exposure to Bitcoin at the expense of more speculative altcoins.

Scenario 2 – Nervous consolidation: The market stops falling but struggles to make a real rebound. False signals and intraday volatility prolong uncertainty.

Scenario 3 – A new wave of declines: Bitcoin would test the $70,000-$80,000 range, while altcoins face low volumes and a lack of positive catalysts.

Historical seasonality of Bitcoin (data 2017-2024) shows that the end of the year tends to be upward – but with significant year-to-year volatility. This means all three scenarios are possible.

The role of institutional investors and regulations

A new element is the more structured presence of institutional capital. Funds that previously viewed cryptocurrencies solely as speculative assets are now incorporating them into broader macro and diversification strategies.

Despite October’s declines, reports suggest more of a rebalancing than a definitive exit from this asset class.

At the same time, October turbulence drew regulators’ attention. Proposals include greater transparency regarding leverage, stricter risk management requirements for exchanges, and unified reporting standards.

Conclusions at the end of 2025

The October crash is not just another chapter of volatility. It’s a test of the sector’s maturity on an unprecedented scale.

It demonstrated how political shocks can spread within minutes across a globalized ecosystem dominated by aggressive leverage dynamics. At the same time, it showed that the market remains liquid even under extreme pressure.

For investors, the task is not to predict Bitcoin’s exact price in December but to recognize the character of this phase. There is a real risk of new shocks driven by macroeconomic uncertainty. On the other hand, the crash accelerated natural selection between solid projects and pure speculation.

Bitcoin and cryptocurrencies remain high-risk assets. Leverage requires utmost caution, especially when the macroeconomic context is complex. Those who stay in the market must do so with a clear horizon, strict risk management, and awareness that moments like October are not obstacles but structural elements of the crypto cycle.