'Uptober' outlook remains… Market optimism persists even after largest-ever liquidations

The crypto asset (cryptocurrency) market, despite experiencing the largest-ever liquidation in history, is still deemed by experts to have a valid October bull market. Bitcoin and major coins underwent short-term corrections, but analysts say structural factors and seasonal rally patterns are supporting expectations of market gains.

On the 15th (local time), according to Cointelegraph, well-known market analyst Scott Melker said, "I expected October to be painted red after the largest-ever liquidation, but it's still holding," adding, "It feels like a small miracle. I don't think we're entering a bear market."

Last weekend's sharp drop pushed crypto market capitalization below $4 trillion, but it quickly rebounded to recover the $4 trillion level. However, Bitcoin (BTC) slipped again below $111,000, temporarily pausing the upward momentum. Melker said, "This decline arose from structural issues within the market, not from external shocks like the 2017 ICO frenzy or the 2021 FTX collapse," and explained, "This incident will be an opportunity for the market to reassess risk and reorganize its structure."

Tim Sun, chief researcher at HashKey Group, also viewed short-term volatility as inevitable. He said, "Investor sentiment has not fully recovered after rapid deleveraging, and risk appetite remains low," diagnosing, "Short-term volatility is expected, but excessive pessimism is unnecessary." He added, "In the medium to long term, monetary easing, easing geopolitical tensions, and liquidity recovery will remain the main trends for the market."

Historically, Bitcoin has shown its strongest returns in October. It earned the nickname 'Uptober' after rising in 10 out of the past 12 Octobers. This year, through early this month it was down 0.6 percent, but since most of the usual gains are concentrated in the latter half of October, there is significant potential for additional rebounds. In fact, after mid-October 2024 Bitcoin rose 16 percent, in 2023 it rose 29 percent, and in 2020 it rose 18 percent.

Melker also said, "With gold recently hitting an all-time high, investors are likely to reallocate funds back into Bitcoin," explaining, "This is a phase of portfolio adjustment, not fear."

Meanwhile, the U.S.-China trade tariff conflict that acted as a catalyst for the market crash is showing signs of easing. A White House official said, "President Donald Trump and Chairman Xi Jinping are pursuing talks related to trade negotiations," and Sun evaluated, "Trade conflicts are not a zero-sum game. Since both countries want tangible benefits, the final result is likely to be more conciliatory than the market fears."

Alongside this, expectations of additional rate cuts by the U.S. Federal Reserve (Fed) and hopes for a 'devaluation trade' due to dollar weakness are also cited as factors supporting October's upswing.