Bitcoin Set for Rare Fourth Annual Drop After October ’Crashtober’ Liquidations
Bitcoin is trading below its 2025 open and appears set for only the fourth annual decline in its history after a large October 10 liquidation event. The sudden ~10% intraday plunge — dubbed “Crashtober” — triggered massive long liquidations, erased significant value from BTC and exposed thin market liquidity. Analysts diverge on interpretation: some (Max Crypto, George Bodine, Scott Melker) see the episode as a structural blow that damaged market-maker risk appetite, reduced liquidity and psychological confidence, and left rallies fragile; others (CrediBULL Crypto) view it as a large but healthy deleveraging that lowered open interest and perp positioning, potentially making future rallies more sustainable if confidence returns. Current price action remains weak near the mid-$80,000s with muted altcoin rotation, suggesting capital may be leaving crypto rather than rotating between assets. Key trader indicators to monitor: aggregate open interest, perpetual funding rates, exchange order-book liquidity, and market-maker behaviour — shifts in these will signal renewed risk appetite or further deleveraging. Short term: expect heightened volatility, fragile rallies and lower leverage. Medium-to-long term: if liquidity and confidence recover, deleveraged markets could support steadier, more sustainable rallies; if not, further drawdowns remain possible.
Bearish
The combined coverage points to a net negative near-term impact on BTC price. The October 10 liquidation event materially reduced leverage and exposed thin order-book liquidity, prompting market makers to pull back and diminishing confidence. Those dynamics tend to suppress short-term rallies and increase downside risk because thinner liquidity amplifies price moves on further selling. Although some analysts argue deleveraging lowers open interest and could create a healthier base for sustainable rallies later, that is conditional on liquidity and risk appetite returning. Key on-chain and derivatives indicators (open interest, perp funding rates, exchange order-book depth, and market-maker participation) currently signal subdued risk-taking. Therefore, the most likely immediate outcome is continued volatility with a downward bias until clear improvements in liquidity and leverage are evident.