Bitcoin Regains Ground After Fed Comments and U.S.-China Diplomatic Thaw

Bitcoin ($BTC) rebounded to around $110,000 on Friday following a volatile Federal Open Market Committee (FOMC) session and easing geopolitical tensions between Washington and Beijing. The move came even as U.S. spot crypto exchange-traded funds (ETFs) recorded another day of heavy outflows, signaling a cautious market mood.

According to CoinGecko, Bitcoin traded between $109,600 and $110,200 in early sessions, recovering from a sharp dip near $107,000 after Federal Reserve Chair, Jerome Powell, said that a December rate cut “is not a foregone conclusion.” The comments briefly unsettled traders, but risk appetite returned as diplomatic progress between the U.S. and China boosted broader sentiment. 

Kyle Rodda, a senior financial market analyst at Capital.com, said traders have shifted focus “from the Fed’s hawkish cut to the U.S.-China trade deal,” suggesting monetary policy anxiety is giving way to optimism about global trade.

Ethereum ($ETH) held steady around $3,900, Binance Coin ($BNB) hovered close to $1,100, and Solana ($SOL) remained under $190. The total crypto market capitalization stayed near $3.76 trillion, steady despite institutional outflows.

Global Diplomacy and Market Uncertainty

With U.S. economic data releases delayed amid a government shutdown, analysts say diplomacy has stepped into what they call a “macro vacuum.” Following a high-level meeting in South Korea, U.S. President Donald Trump and Chinese President Xi Jinping announced tariff reductions and joint commitments on several issues, including energy and fentanyl enforcement.

Timothy Misir, head of research at BRN, called the outcome of the talks “a confidence boost,” noting that agreements across trade, energy, and law enforcement have reassured markets at a time when investors lack key macro indicators. “The U.S. GDP report delay has muddied near-term reads,” Misir added, referring to the postponed economic data that typically guide investor sentiment.

Analysts also said that government gridlock in Washington continues to complicate the broader outlook. The absence of official data, including GDP and inflation figures, has made it difficult for investors to gauge the health of the economy and the timing of potential rate changes.

Meanwhile, U.S. spot ETF flows reflected this uncertainty. On Thursday, Bitcoin spot ETFs logged around $488 million in net outflows, with none of the funds recording inflows. Spot Ethereum ETFs followed the same path, shedding roughly $184 million. In contrast, Solana ETFs bucked the trend with $37.33 million in inflows, marking their third consecutive day of gains led by Bitwise’s BSOL product.

Despite the mixed sentiment, the end of October approaches with Bitcoin’s monthly performance on track to become one of its weakest Octobers in over a decade. According to CoinGlass data, early-month record highs were followed by over $10 billion in liquidations. Yet, some analysts remain optimistic about Bitcoin’s resilience.

Paul Howard, senior director at Wincent, said, “BTC prices should hold in the $110,000-$120,000 range post the Fed rate cut,” though he noted that “concerns of a further cut potentially not happening have moved prices slightly lower.” He added, “My sense is this is convenient for short-term accumulation, and we will see macro improvements heading into November, which will drive risk assets like BTC higher before some end-of-year consolidation.”

Bitcoin’s 17th Anniversary

As Bitcoin stabilizes near $110,000, the cryptocurrency also marks a major milestone. The Bitcoin whitepaper, authored by the pseudonymous Satoshi Nakamoto, turns 17 years old this week. Released on October 31, 2008, the nine-page document titled “Bitcoin: A Peer-to-Peer Electronic Cash System” introduced a radical concept: decentralized digital money operating without banks or governments.

The paper described a network where online payments could be sent directly from one user to another without intermediaries. “A purely peer-to-peer version of electronic cash would allow online payments to be sent directly from one party to another without going through a financial institution,” the whitepaper’s abstract stated.

The vision was born in the aftermath of the 2008 global financial crisis, a period of collapsing banks and eroding trust in traditional finance. Satoshi’s first block on January 3, 2009, included a now-famous message referencing a newspaper headline: “The Times 03/Jan/2009 Chancellor on brink of second bailout for banks.” The embedded text underscored the motivation to create a monetary system immune to centralized control and government bailouts.

From those early days, Bitcoin has transformed dramatically. Once a symbol of digital freedom and decentralization, it has evolved into a mainstream asset class. Hedge funds, corporations, and institutional investors now treat BTC as part of diversified portfolios. Its market capitalization has surpassed $2.18 trillion, ranking it eighth among the world’s top assets by value, above companies like Broadcom and Meta Platforms.

The first-ever Bitcoin transaction occurred in 2009 when Satoshi Nakamoto sent 10 BTC to software developer Hal Finney. This was followed by the famous “Bitcoin Pizza Day” on May 22, 2010, when developer Laszlo Hanyecz spent 10,000 BTC for two pizzas, worth hundreds of millions of dollars today. These early exchanges set the stage for a decentralized financial system that has since grown far beyond its original intent.

Today, more than 353 corporations, funds, and entities collectively hold around 4.05 million BTC, roughly 20% of the circulating supply, according to data from BitcoinTreasuries.net. Institutional giants such as BlackRock, Fidelity, Strategy and Tesla are among the largest holders. Governments, too, have entered the space. 

The United States, Canada, El Salvador and Bhutan have all disclosed holdings as part of digital asset strategies. Under President Trump’s administration, pro-crypto regulations have accelerated innovation and adoption, further legitimizing Bitcoin in the eyes of traditional finance.

Bitcoin ETFs, both spot and futures, have helped bridge the gap between traditional markets and digital assets. Though originally intended as a peer-to-peer currency, Bitcoin now functions more as a store of value often dubbed “digital gold.” It trades mainly on regulated exchanges under strict Know Your Customer (KYC) and Anti-Money Laundering (AML) rules, the very oversight that Satoshi sought to avoid.

While this institutional integration has bolstered Bitcoin’s liquidity and stability, it has also distanced the network from its original anti-establishment ideals. What began as “money for the people” has become a central player in global finance, reflecting both progress and paradox.

On the technical side, Bitcoin hit a new all-time high of $126,199 earlier this month before retracing to current levels. Prominent analyst PlanB, known for his Stock-to-Flow (S2F) model, argued that bearish interpretations of Bitcoin’s four-year halving cycles rely on too little historical data. 

His model projects an average BTC price between $288,000 and $500,000 for the 2024-2028 period. According to PlanB, the 14-month Relative Strength Index (RSI) remains below 80, suggesting Bitcoin has not yet entered a phase of extreme overvaluation.

Red October and Rising Miner Stocks

Despite its strong long-term trajectory, Bitcoin is set to end October in the red for the first time in seven years. Historically dubbed “Uptober,” the month has produced positive returns for six consecutive years. This time, however, BTC is down about 3.35% for the month, breaking a streak that dates back to 2018.

“Last day of the month – we need a strong green candle today or we’ll see our first red October close in 7 years,” analyst Jelle said in a post on X. Another trader, who goes by TraderAAG, added, “October turned red for the first time in 7 years! The crypto market humbled a lot of traders this month – momentum faded, confidence shaken.” Analyst Crypto Damus described the month’s volatility as “nothing normal,” emphasizing how unusual October’s losses are given its historically bullish record.

Market watchers remain split on what this decline means. Some see the drop as a setup for a stronger November rally, while others warn it could signal the late stages of the current bull cycle. Analyst Crypto Rover noted, “The last time BTC ended October in the red was in 2018, and November saw a brutal 36.57% drop. Should we be worried this time?” Timothy Peterson, author and analyst, cautioned that “there is basically no correlation between October and subsequent months,” but noted that weak Octobers typically precede slower Q4 gains.

Historically, November has been Bitcoin’s strongest month, with average gains of 46% since 2013. The final quarter of the year often delivers significant rallies, averaging 78% gains according to CoinGlass data. Even during bear cycles, Q4 tends to be highly volatile, with dramatic swings either way.

Meanwhile, investor enthusiasm for Bitcoin ETFs appears to be cooling. CryptoQuant data shows U.S. spot ETF outflows averaging 281 BTC per week, one of the lowest readings since April. Ether inflows have stalled, and Coinbase trading premiums have flattened to zero. Institutional and retail traders alike seem to be taking profits. 

Glassnode data indicates that Bitcoin remains below the short-term holder cost basis of around $113,000, with long-term holders distributing roughly 104,000 BTC per month. Whale transfers to exchanges have jumped to $293 million daily, reinforcing the view that investors are trimming exposure rather than adding.

Bitcoin’s 4-hour chart remains under pressure, with the price slipping 1% in the past 24 hours. If it closes below the 61.8% Fibonacci retracement level near $106,453, analysts warn it could retest the mid-October low of $102,000.

Interestingly, Bitcoin mining companies have outperformed the coin itself this year. Despite BTC’s 59.5% year-to-date gains, major miners like IREN have surged as much as 492%, while even the weakest performer, Hive Digital Technologies, is up 85%. Mining stocks have increasingly decoupled from Bitcoin’s price, with many firms pivoting toward artificial intelligence infrastructure and data center operations.

Still, risks remain. Companies like Marathon Holdings, Riot Platforms, and CleanSpark face heavy depreciation costs as mining hardware ages quickly. Many miners have diluted shares to finance expansion, exposing investors to further volatility. The overall Bitcoin hashrate has grown by 500% in five years, driven by the buildout of large-scale mining facilities. 

As the next halving approaches, the sector faces pressure to adapt or diversify. Analysts believe that mining stocks could continue to decouple from Bitcoin while retaining upside potential if a new bull market takes shape.