The bitcoin (BTC) market experienced a week of euphoria and panic in a matter of days.
After celebrating a new all-time high above $126,000 on Monday, October 6, the digital asset’s price saw a sharp correction on Friday, falling to levels close to $102,000.
The following graph, provided by TradingView, shows what the behavior of BTC has been in the last week:
The trigger was not a flaw in its protocol nor an inherent problem in its technology, but an external factor that shook global markets: the threat of the president of the United States, Donald Trump, of impose a “massive increase in tariffs” on Chinese products.
These types of macroeconomic events, although they generate short-term volatility, they do not alter the fundamentals that have driven bitcoin’s bullish macrotrend. For those who are aware of this, this correction is nothing more than a readjustment that presents a valuable opportunity to accumulate the asset at a discounted price.
On-chain data and the behavior of different investor segments suggest that the bullish thesis remains more valid than ever.
Friday, October 10, was a clear reminder of how geopolitics can impact all asset classes. Trump’s statements revived the specter of a trade war, leading investors to reduce their exposure to assets considered “risky”. Bitcoin and stock indices felt the blow.
However, amid widespread nervousness, the internal structure of the bitcoin market showed resilience. Analyst Willy Woo pointed out in your X account:
In the wake of Friday’s big stock sell-off, fears of a 100% tariff on China and an escalation of the trade war, BTC held up well. Internally, BTC was building a bullish structure with increasing inflows that likely protected it. So far, flows are holding up well.
Willy Woo, trader and market analyst.
This abrupt drop served, as is often the case, to purge excess leverage from the system. Carlos Maslatón, Argentine lawyer and former treasurer of Xapo, described the scenario crudely: “Millions of positions melted on Friday in just three hours, assets of 10 thousand, 100 thousand, one or ten million dollars taken to zero.” According to Maslatón, It was a lesson for “the new generation […] “They didn’t know that such a thing could happen.”a tough introduction to the risks of financial leverage.
Volatility, although painful to many, is also seen by others as an inherent characteristic of the market that can be managed. Trader Mariel Lang commented in this regard: «You don’t need a crystal ball, you need strategies that benefit from uncertainty. Systematize. You’ll thank yourself.”
While some leveraged operators suffered catastrophic losses, such as the case of Juan Martín Collavini, who express in networks having lost “years and years thrown away”, others saw the panorama from a strategic perspective.
Beyond the short-term noise, The reasons that led bitcoin to its all-time high are still present.
Institutional demand and the large flow of capital through spot exchange-traded funds (ETFs) in the United States has been the great driver of this cycle. Just on Monday, October 6, these instruments recorded net inflows of $1.21 billion, their second best day in history.
BlackRock’s IBIT ETF, the largest on the market, last week exceeded 800,000 BTC under management, a figure that represents 3.8% of the entire bitcoin supply that will exist.
This systematic accumulation by Wall Street giants demonstrates a long-term conviction that is not shaken by a social media post from the American president. The investment thesis of these corporate and institutional giants is based on the unique attributes of bitcoin: its absolute scarcity and its nature as a store of value asset.
This last point is crucial. In a global context of weakening of the dollar, whose DXY index has accumulated more than 220 days below its annual average, and persistent inflation, investors are seeking refuge.
As CriptoNoticias has reported, both bitcoin and gold have recently set all-time highs, a sign, according to analyst Bob Czeschin, that we could be “going back to the 1970s,” a decade of high inflation and distrust in fiat money. The threat of a tariff war only accentuates these fears, strengthening the narrative of bitcoin as “digital gold.”
Samson Mow, CEO of Jan3, summed it up in an interview with this media days ago:
Everyone is competing for a piece of the 21 million pie and there isn’t much bitcoin left.
Samson Mow, CEO of Jan3.
The supply of bitcoin is fixed and predictable; Demand, driven by ETFs, corporations and the eventual arrival of nation-states, is growing. The equation, in the long term, seems clear.
The reaction of a significant part of the market to Friday’s decline validates the opportunity thesis. Far from a general panic, Many investors took advantage of the lower prices to increase their holdings.
Tomás Field, public relations manager of the Lemon exchange, shared revealing data with CriptoNoticias. According to Field, in the midst of the fall, “users saw opportunity and bought heavily, especially against pesos.” [argentinos]». The phenomenon was of such magnitude that The platform recorded peaks of «1.5 purchases per second at the time of the drop. It was really crazy yesterday. He took advantage of the dip».
This behavior shows a growing maturity in the retail market, which seems to have learned from previous cycles and now interprets corrections for what they are: temporary readjustments in a larger trend. The buying frenzy in Lemon demonstrates that conviction in bitcoin’s long-term potential is robust.
In conclusion, while volatility can be disconcerting, it is critical to differentiate the catalyst for the event from the underlying health of the asset.
Friday’s drop was a reaction to an external macroeconomic shock that affected all markets, not a sign of weakness in Bitcoin’s value proposition.
Record institutional flows, growing adoption as a store of value and unchanging supply are pillars supporting a long-term bullish outlook.
For those with a proper time horizon, Friday’s storm may have left clear skies and an unbeatable purchasing opportunity.