Bitcoin faces second losing October as US spot demand weakens

With Bitcoin price dipping from roughly $83,600 at the close of September to $79,200, the cryptocurrency is facing a second consecutive loss in October, challenging its reputation for a strong "Uptober." This decline is being attributed to weak buying interest in the U.S. spot market, even as exchange-traded funds brought in $176 million just before the Federal Reserve's scheduled decision on October 28.

Despite the bearish signals from demand metrics, the digital asset managed to climb back toward $81,500 on Wednesday, mitigating some of the initial monthly loss, though the final tally remains uncertain with three days remaining in the month. Historically, Bitcoin closed lower in October in 2025, experiencing a drop of about 3.8%. Should this month conclude negatively, 2026 would mark the second consecutive October loss, following five years of gains that helped cement the seasonal nickname. CryptoQuant's report highlights that Bitcoin saw significant growth in previous October months: 27.6% in 2020, 40% in 2021, 5.5% in 2022, 28.5% in 2023, and 10.9% in 2024. While these five positive years averaged a 22.5% return, the individual gains varied widely. When factoring in the 2025 downturn, the average for October from 2020 to 2025 drops to approximately 18.1%. This six-year average is presented as a historical observation, not a prediction, and the current October has not yet concluded.

The month commenced with Bitcoin trading near $83,567, building on a robust rebound during the third quarter. Analysts at Bitfinex had previously cautioned that the strength of that recovery relied on fresh spot purchases, rather than merely short covering or positioning in futures contracts. Furthermore, reports from crypto.news indicated that ETF subscriptions had already slowed considerably after the buying frenzy seen in September.

CryptoQuant's recent analysis points toward a sustained lack of purchasing momentum from the United States. Its Coinbase Premium Index, which compares Bitcoin prices on Coinbase against those on international exchanges, remained in negative territory throughout October, hitting its lowest point since late June at minus 0.146 on October 24. A negative premium suggests that buyers on Coinbase were paying less than counterparts in offshore markets, though this metric does not detail every American buyer nor prove that all U.S. investors were selling. According to the firm's demand estimates, apparent spot demand registered as negative daily starting October 14. By October 25, the 30-day measurement indicated a deficit of roughly 76,000 BTC, meaning buying power was insufficient to absorb the available coin supply according to CryptoQuant's model.

Julio Moreno, the firm's research head, noted that the Bull Score Index had fallen from 90 down to 60. Even so, six of the model's ten indicators retained a bullish stance, signaling condition deterioration without confirming a complete reversal. Moreno summarized the situation, stating, ""Uptober" has dissapointed as: – Spot demand continued to contract, while US investors remained mostly on the sidelines. – Trader's took profits, while there's still gains to be realized. – Overall conditions became less bullish (Bull Score Index down from 90 to 60)."

In contrast, ETF data paints a different picture. SoSoValue data reveals that U.S. spot Bitcoin funds attracted $176 million on October 27; BlackRock's IBIT secured $151.5 million of that, while Fidelity's FBTC accounted for $24.5 million. These acquisitions followed substantial combined withdrawals totaling approximately $773.5 million on October 22 and 23. It is worth noting that the divergence between positive ETF subscriptions and the negative estimated spot demand has occurred before, as an examination of fund flows showed that billions invested in September's ETF buying did not immediately shift CryptoQuant's 30-day apparent demand measure into positive territory.

Bitcoin's price movement has occurred just before the Federal Reserve's announcement on Wednesday, as investors await clarity regarding a potential interest rate hike in December. This October 27–28 meeting precedes the release of U.S. GDP and personal consumption expenditures inflation data, scheduled for Thursday. Entering the month, an October market outlook pegged $82,000 as a critical benchmark for Bitcoin. Its analysts anticipated that institutional flows and inflation reports would determine if buyers could sustain the recovery, independent of October's historical performance.

CryptoQuant's latest risk indicators are situated lower. Moreno pointed to the 365-day moving average near $77,585, the realized price around $74,041, and the 200-day moving average near $73,028 as reference points should Bitcoin experience a decline. The firm's report also indicated that the premium of the market price over the realized cost for holders ranging from one to three months narrowed from 33.4% on September 22 to 8.1% on October 26, resulting in a smaller buffer of unrealized profit for those holders should prices fall. Market commentator Crypto Warrior asserted that this disappointing October would not dictate Bitcoin's trajectory for November, with the next U.S. midterm elections scheduled for November 3, following the month's final trading sessions.

Why it matters

The divergence between positive ETF inflows and negative estimated spot demand signals underlying weakness in retail buying interest. Investors are now closely watching the Federal Reserve's guidance and inflation reports to determine if the recent price rebound can sustain itself. This sets the stage for potential volatility heading into November.