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Bitcoin (BTC) saw fresh gains on Oct. 23 as the weekend delivered a potential launchpad for the bulls.

$10 million liquidations as Bitcoin steps higher

Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it spiked above $19,500 as the weekly close approached.

While modest, the $300 move punctuated otherwise flat trading behavior, Bitcoin notoriously rangebound on daily timeframes.

Now, hopes were high that the market would offer more solid price action in the coming days, $20,000 remaining out of reach for over a week.

"Green week ahead, preferably first closing the current CME gap," popular trader Crypto Ed told Twitter followers in an update at the time of writing.

An army of small Bitcoin (BTC) investors has been fighting with their larger counterparts for months to keep the price above $18,000.

Bitcoin accumulation strong among fishes

Notably, there has been some on-chain divergence between so-called whales (entities that hold more than 1,000 BTC) and fishes (entities that hold relatively smaller amounts of BTC) as Bitcoin continues to fluctuate inside the $18,000-$20,000 area.

Bitcoin fishes have been accumulating BTC during the coin’s sideways trend. For instance, the net Bitcoin supply held by addresses with 100-1,000 BTC balance has increased from 3.71 million in June to 3.77 million in October, according to data provided by Glassnode.

Similarly, the supply of Bitcoin held by addresses with a 10-100 BTC balance has also risen from 3 million to 3.15 million in the same period. The trend is similar across the entities holding anything between 0.001 and 10 BTC.

Meanwhile, the same period of Bitcoin’s sideways price action coincided with a decline in BTC supply held by whales. For instance, the Bitcoin supply held by the 1,000-10,000 BTC cohort has dropped from 3.82 million to 3.69 million since June.

Bitcoin (BTC) will top $100,000 next year but a record-breaking bear market will follow, a popular trader believes.

In a Twitter discussion on Oct. 22, Credible Crypto endorsed a theory that Bitcoin’s next halving will also see macro lows of just $10,000.

BTC bulls need only wait a year for $100,000

With consensus calling for Q4 2022 to match the end of the 2018 Bitcoin bear market, few are in the mood to call a trend change.

While a bold prediction from LookIntoBitcoin creator Philip Swift recently gave the current bear market just months to live, most commentators continue to target new lows.

For Credible Crypto, however, the really interesting territory lies further ahead — but 2023 will constitute a major turning point.

Bitcoin (BTC) entered an ascending channel in mid-September and has continued to trade sideways activity near $19,500. Due to the bullish nature of the technical formation and a drop in the sell pressure from troubled miners, analysts expect a price increase over the next couple of months.

Independent analyst @el_crypto_prof noted that BTC's price formed a "1-2-3 Reversal-Pattern" on a daily time frame, hinting that $20,000 could flip to support soon.

Fundamental analysts are also attributing the sideways action to troubled Bitcoin-listed mining companies. For example, Stronghold Digital Mining announced a debt restructuring on Aug. 16 that included the return of 26,000 miners.

One public miner, Core Scientific, sold 12,000 BTC between May and July, while publicly traded mining companies sold 200% of their Bitcoin production. Bitcoin enthusiast @StoneysGhoster adds that excessive leverage caused the forced selling, not the mining activity, itself.

Regardless of the base case for Bitcoin's price recovery above $20,000, investors fear the impact of an eventual stock market crash as central banks continue to increase interest rates to curb inflation.

Welcome readers, and thanks for subscribing! The Altcoin Roundup newsletter is now authored by Cointelegraph’s resident newsletter writer Big Smokey. In the next few weeks, this newsletter will be renamed Crypto Market Musings, a weekly newsletter that provides ahead-of-the-curve analysis and tracks emerging trends in the crypto market. 

The publication date of the newsletter will remain the same, and the content will still place a heavy emphasis on the technical and fundamental analysis of cryptocurrencies from a more macro perspective in order to identify key shifts in investor sentiment and market structure. We hope you enjoy it!

DeFi has a problem, pump and dumps

When the bull market was in full swing, investing in decentralized finance (DeFi) tokens was like shooting fish in a barrel, but now that inflows to the sector pale in comparison to the market’s heyday, it’s much harder to identify good trades in the space.

During the DeFi summer, protocols were able to lure liquidity providers by offering three- to four-digit yields and mechanisms like liquid staking, lending via asset collateralization and token rewards for staking. The big issue was many of these reward offerings were unsustainable, and high emissions from some protocols led liquidity providers to auto-dump their rewards, creating constant sell pressure on a token’s price.

Total value locked (TVL) wars were another challenge faced by DeFi protocols, which had to constantly vie for investor capital in order to maintain the number of “users” willing to lock their funds within the protocol. This created a scenario where mercenary capital from whales and other cash-flush investors essentially airdropped funds to platforms offering the highest APY rewards for a short period of time, before eventually dumping rewards in the open market and shifting the investment funds to the greener pastures.

Bitcoin (BTC) and other riskier assets slipped on Oct. 21 as traders scrutinized macro indicators that suggest the Federal Reserve would continue to hike rates. Nonetheless, the BTC/USD pair remains rangebound inside the $18,000–$20,000 price range, showing a strong bias conflict in the market.

BTC price holding above $18K since June

Notably, BTC's price has been unable to dive deeper below $18,000 since it first tested the support level in June 2022. As a result, some analysts believe that the cryptocurrency is bottoming out, given it has already corrected by over 70% from its record high of $69,000, established almost a year ago.

"During the 2018 bear market, BTC saw a max drawdown from peak to trough of 84%, lasting 364 days, while the 2014 cycle lasted longer, bottoming after 407 days," noted Arcane Research in its weekly crypto market report, adding:

"Both bottoms were followed by unusually low volatility."

In addition, a flurry of widely-watched on-chain Bitcoin indicators also hints at a potential bullish reversal ahead. Let's look at some of the most historically significant metrics. 

Bitcoin (BTC) dipped further below $19,000 on Oct. 21 as rumors circulated over the United States Federal Reserve.

Fed still on track for major November rate hike

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD abruptly dropping before the Wall Street open, hitting lows of $18,660 on Bitstamp.

A recovery took the pair higher, and it was attempting reclaim $19,000 as support at the time of writing.

The action came as commentators claimed the Fed was softening its policy on rate hikes ahead of the Nov. 1–2 Federal Open Market Committee (FOMC) meeting.

Citing mainstream media quotations from Fed officials, they suggested that the November hike could be the last 75-basis-point adjustment, with smaller ones following.

Ethereum has witnessed a substantial drop in its daily active address (DAA) count over the last four months, raising fears about more downside for Ether (ETH) price in the coming weeks.

Stagnant Ethereum price spooks investors

The number of Ether DAA dropped to 152,000 on Oct. 21, its lowest level since June, according to data provided by Santiment. In other words, the plunge showed fewer unique Ethereum addresses interacting with the network.

Interestingly, the drop comes after Ether’s 80%-plus correction from its November 2021 high of around $4,850. This coincidence could mean two things: Ethereum users decided to leave the market and/or paused their interaction with the blockchain network after the market’s downturn.

Santiment analysts blamed the drop on “weak hands,” sentimental traders who drop out of the market during a bearish or stagnant phase, noting:

“Disinterest [is] at a high as [the Ethereum] prices have stagnated.”

Bitcoin (BTC) may spend the time until its next block subsidy halving battling recession, Elon Musk suggested.

In a tweet on Oct. 21, the Tesla CEO revealed his belief that the world would only exit recession in Spring 2024.

Musk: Recession will "probably" stay until Q2, 2024

After the United States entered a technical recession with its Q3 GDP data, debate continues over how much worse the scenario could get.

For Musk, while long predicting the U.S. economy would enter recession, the likelihood of a global downturn lingering is now real.

Asked on Twitter how long he considered a recession to last, the world’s richest man was noncommittal, but erred on the side of years rather than months.

The current crypto bear market has induced panic, fear and uncertainty in investors. The dire situation started when the global crypto market capitalization dropped below the $2 trillion mark in January 2022. Since then, the price of Bitcoin (BTC) has decreased by over 70% from its all-time high of $69,044.77, reached on Nov. 10, 2021. Similarly, the values of other major cryptocurrencies such as Ether (ETH), Solana (SOL), Avalanche (AVAX) and Dogecoin (DOGE) have decreased by around 90%. 

So does history tell us anything about when the bear market will end? Let’s start by examining the causes of the 2022 bear market.

Catalysts of the 2022 bear market

There are several factors that caused the current bear run.

First off, the build-up to the bear market started in 2021. During this period, many regulatory authorities threatened to introduce stringent laws governing cryptocurrencies. This created fear and uncertainty in the market. For example, the U.S. Securities and Exchange Commission (SEC) issued a lawsuit against Ripple. China banned Bitcoin mining, resulting in most of its BTC miners having to relocate to other countries.

A global increase in inflation and rising interest rates instilled fear and uncertainty in the market resulting in lower crypto investment than expected. Although there is much publicity pertaining to the United States inflation and interest rate, other countries such as India have experienced similar challenges.

Bitcoin (BTC) showed no signs of a breakout on Oct. 20 as tantalizing sideways action dragged on.

Analyst: Bitcoin range "congested and critical"

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD firmly rangebound at around $19,000 overnight, moving only around $400 up or down.

United States equities opened with no significant volatility, this focused more on the United Kingdom, where the pound reacted to news that Liz Truss had resigned as Prime Minister.

Chart data circulating on social media at the time of writing showed that GBP and BTC volatility had become practically identical, the latter already in its least volatile period since 2020.

With macro triggers failing to have an impact, analysts flagged solid support and resistance levels keeping price action in check.

Bitcoin (BTC) worth over $600 million moved for the first time since the last bear market on Oct. 18, analysis has revealed.

In a Twitter thread, monitoring resource Whalemap flagged a transaction involving 32,000 BTC.

Buyer could be “willing to acquire” 32,000 BTC at $19,000

In the latest sign that the current spot price is affecting the behavior of even longer-term holders, a whale entity that purchased BTC near the pit of the last bear market appears to have sold.

According to Whalemap, 32,000 coins left their wallet for the first time since December 2018 this week.

“32,000 Bitcoins belonging to a whale wallet moved yesterday. They were dormant since Dec 2018,” the Whalemap team wrote in accompanying commentary.

The past eighty days have been moderately bearish for cryptocurrencies as the altcoin market capitalization declined by 16%. The downside movement can be partially explained by the United States Federal Reserve’s quantitative tightening, rising interest rates and the halting of asset purchases. Although they are aimed at curbing inflationary pressure, the policy also increases borrowing costs for consumers and businesses.

The downfall of Solana’s SOL (SOL) token has been even more brutal, with the altcoin facing a 29% correction since August. The smart contract network focuses on low fees and speed, but the frequent outages highlight a centralization issue.

The latest setback occurred on Sept. 30 after a misconfigured validator halted blockchain transactions. A duplicate node instance caused the network to fork, as the remaining nodes could not agree on the correct chain version.

Recently, Solana co-founder Anatoly Yakovenko placed his bets on Firedancer, a scaling solution developed by Jump Crypto in partnership with the Solana Foundation. Dubbed the long-term fix to the network outage problem, the mechanism should be ready for testing in the coming months.

On Oct. 11, Solana-based decentralized finance exchange Mango Markets was hit with an exploit of over $115 million. The attacker successfully manipulated the value of MNGO native token collateral, taking out “massive loans” from Mango’s treasury.

Bitcoin (BTC) sagged with United States equities at the Oct. 19 Wall Street open as markets awaited tech earnings.

Eurozone sees fresh all-time high inflation

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD circling $19,000 after falling steadily overnight.

Still trapped in a tight range, the pair offered few cues to traders seeking advantageous short-term plays, while some sources argued that overall, current levels represented solid buy levels.

“With little calendar events till the next FOMC in early November, crypto continuing to lag behind equities, and skews near flat, protective downside structures are the cheapest levels they have been since June,” trading firm QCP Capital concluded to Telegram channel subscribers on the day.

QCP Capital was referring to the upcoming meeting of the U.S. Federal Reserve’s Federal Open Market Committee, at which a decision on interest rate hikes would be made.

Cardano (ADA) price is in the process of painting its seventh red monthly candle in a row as the token fell to its lowest level since February 2021.

The trend saw ADA's price rising nearly 800% to $3.16 between February 2021 and September 2021, followed by a complete wipeout of those gains entering October 2022. Amusingly, the entire price action took the shape of the "Burj Khalifa," the world's tallest skyscraper in Dubai.

ADA price eyes 35% price crash

The ADA price correction began primarily in the wake of a similar downtrend across the cryptocurrency market, led by the Federal Reserve's aggressive interest rate hikes to tame rising inflation.

Even an optimistic Cardano network upgrade dubbed Vasil was not enough to bring its buyers back to the market.

Notably, ADA's price has dropped by nearly 20% since the Vasil hard fork nearly a month ago — an update aimed at improving its network's scalability and smart contract capabilities.

Bitcoin’s (BTC) future may “stand in stark contrast to the rest of the world,” asset manager Fidelity Investments predicts.

In a recent research piece, “The Rising Dollar and Bitcoin,” released Oct. 10, Fidelity Digital Assets, the firm’s crypto subsidiary, drew a line between Bitcoin and other currencies.

Bitcoin “does not correspond to another person’s liability:” Report

While hardly a stranger to bullish takes on Bitcoin, Fidelity continues to publicly reiterate its faith in the largest cryptocurrency despite the near year-long bear market.

In the report, analysts stated just how far Bitcoin as an asset has diverged from what is currently considered the norm. In the new high-inflation environment, Bitcoin’s fixed issuance and supply are of particular importance.

“Therefore, bitcoin may soon stand in stark contrast to the path that the rest of the world and fiat currencies may take – namely the path of increased supply, additional currency creation, and central bank balance sheet expansion,” they explained.

The price of Quant Network (QNT) eyes a sharp reversal after an impressive 450% rally in the past four months.

QNT's downside outlook takes cues from a flurry of technical and on-chain indicators, all suggesting that investors who backed its price rally have likely reached the point of exhaustion.

Here are three reasons why it could be happening.

Quant's daily active addresses drop

Interestingly, the period of QNT's massive uptrend coincided with similar upticks in its number of daily active addresses (DAA). This metric represents the number of unique addresses active on the network as a sender or receiver.

As of Oct. 17, the Quant Network's DAA reached an all-time high of 10,949, up from around 5,850 four months ago, data from Santiment shows. Its upsurge during the QNT price uptrend shows traders were net buyers.

Bitcoin (BTC) has been trying to break above the $20,500 resistance for the past 35 days, with the latest failed attempt on Oct. 6. Meanwhile, bears have displayed strength on four different occasions after BTC tested levels below $18,500 during that period.

Investors are still unsure whether $18,200 was really the bottom because the support level weakens each time it is tested. That is why it’s important for bulls to keep the momentum during this week’s $510 million options expiry.

The Oct. 21 options expiry is especially relevant because Bitcoin bears can profit $80 million by suppressing BTC below $19,000.

Bears placed their bets at $19,000 and lower

The open interest for the Oct. 21 options expiry is $510 million, but the actual figure will be lower since bears were overly-optimistic. These traders completely missed the mark placing bearish bets at $17,500 and lower after BTC dumped below $19,000 on Oct. 13.

The 0.77 call-to-put ratio shows the dominance of the $290 million put (sell) open interest against the $220 million call (buy) options. Nevertheless, as Bitcoin stands near $19,000, most bearish bets will likely become worthless.