Bitcoin Hits New All-Time High: A Recap of Market Developments
Bitcoin surged strongly this Wednesday, breaking through the previous high of $64,846 and setting a new all-time high of $66,999 after six months (OKX data). Led by Bitcoin, the crypto market saw a broad rally. This new all-time high has completely dispelled the bearish sentiment that has lingered since the "5.19" crash.
From the April peak to the October high, more than half a year passed. During this period, several events unfolded that shaped the current state of the industry. Let's review what happened in the market over the past six months and what is happening now, so we can better prepare for what lies ahead.
With hindsight ("Monday morning quarterbacking"), the "5.19" crash was triggered when internal market factors were ignited by external pressures, causing a market collapse. Specifically, prior to 5.19, the overall boom in the crypto market had caused overheating and excessive euphoria across the market, with large numbers of new investors entering and the so-called meme season emerging. It was like a rainstorm causing a reservoir's water level to rise rapidly, far exceeding the warning threshold, while the dam lacked materials for reinforcement. Then, like a boulder falling from the sky into the reservoir, a breach became inevitable. The floodwaters swept up the fish in the water and completely destroyed the original dam. While this caused serious flooding, when a new dam formed downstream, it objectively increased the reservoir's capacity—greater storage gives the creatures in the water more possibilities.
So, has the new dam been formed?
We can trace the post-"5.19" market trajectory to find out: From "5.19" to late July—a span of two months—the entire market remained sluggish in the aftermath of the breach, with occasional sparks of recovery that quickly fizzled out without making much impact.
From late July to mid-September, the market bottomed out and bounced back, breaking out of the bottom range. However, two dark clouds hung overhead: one was that Bitcoin, the foundation of the crypto market, never showed strong performance and seemed to be dragged along reluctantly; the other was that the external macro environment remained uncertain. As it turned out, before the Fed's September FOMC meeting, the market pulled back again.
After entering October, Bitcoin finally displayed its king-like strength with a powerful rally that dragged the market up, setting a new all-time high this Wednesday. At this point, the foundation of the new dam has finally taken shape—the conditions for reinforcing and raising the new dam and filling the new reservoir are now in place.
As mentioned above, each collapse of an old dam and formation of a new one objectively expands the new reservoir's capacity. But where does the water for the new reservoir come from?
First, let's discuss the recently hot Bitcoin ETF. This past Tuesday (October 19, 9:30 AM Eastern Time), the Pro Shares Bitcoin futures ETF officially debuted on the NYSE Arca exchange under the ticker BITO. Total trading volume on the first day approached $1 billion, ranking second only to BlackRock's carbon-neutral ETF, making it the second-highest first-day trading volume in history. This marks that after eight years of effort, the SEC (U.S. Securities and Exchange Commission) has finally opened the door for Bitcoin ETFs. In the U.S. traditional financial trading market, ETFs are one of the most important trading vehicles. When a product appears in the form of an ETF, it signifies that its compliance and maturity have received a high level of market recognition.
Although the stimulus effect of Bitcoin futures ETFs cannot yet compare to spot ETFs, they can still bring stronger liquidity to the spot market, given that ETF trading volume can account for over 30% of total U.S. exchange trading volume. Funds flowing into the crypto market from traditional finance through ETFs will help push the market to new heights.
Second, there is the global quantitative easing monetary policy of various countries. As the engine driving all global markets, this is the fundamental source of "fresh capital" for the entire market. Since last March, the United States has released up to $31 trillion in various dollar liquidity and economic stimulus packages. According to The Economist, as of the first half of this year, central banks in developed countries alone have injected $11.2 trillion in liquidity. Due to the ongoing pandemic and difficulties in economic recovery, there are no signs of this trend ending anytime soon.
Lastly, there is the entry of traditional financial institutions represented by Wall Street. According to the 21st Century Business Herald, if you add up the Bitcoin held by trust funds, listed companies, and digital assets projects, starting from the end of last year, Wall Street has controlled approximately 50% of Bitcoin's current supply. Among them, besides the well-known Grayscale, there are BlackRock—the world's largest asset management company—as well as Tesla, MicroStrategy, Galaxy Digital, and others. According to buybitcoin data, ETFs, nations, listed companies, private companies, and other entities collectively hold over 1.48 million Bitcoin, worth $94.6 billion.
With so many sources of fresh capital, Bitcoin has strongly set a new all-time high, laying a solid "new dam foundation" for the crypto market.
Returning to the crypto market itself, while the overall trend is positive, what does the specific path forward look like? We still cannot easily predict, but we can examine the current market conditions through some data indicators.
First: the S2F model. This indicator measures BTC's scarcity through the ratio of BTC's stock to flow. The indicator gained fame because its creator, Plan B, consecutively predicted Bitcoin's recent prices: On June 20 this year, Plan B predicted Bitcoin's monthly closing prices for 2021 using the improved new S2F model: August > $47k, September > $43k, October > $63k, November > $98k, December > $135k. August and September have both hit their targets precisely, and Bitcoin's October price has also been reached so far. However, in June this year, his S2F model was also invalidated.
BTC-S2F Model (Source: qkl123)
Second: the Bitcoin Rainbow Chart. Bitcoin has just entered the "泡沫存在" (FOMO / maximum bubble) zone from the "继续持有" (HODL) zone. The most recent time this happened was in January this year, when Bitcoin experienced a significant correction before continuing to rise and hit new highs. If we look further back, the previous two Bitcoin halving bull markets only truly topped out after Bitcoin entered or exceeded the "严重泡沫" (Max Bubble) zone.
Bitcoin Rainbow Chart (Source: qkl123)
Third: the Puell Multiple indicator. The current reading is 1.52, and the current data remains within a relatively safe range. When the value is above 1, it indicates that miners' daily mining profitability is better than the one-year average return. When it stays in the 4 to 10 range over a period of time, it suggests that market sentiment is quite greedy and may be in the late bull market stage. Looking at Bitcoin's total network hashrate, it has been steadily increasing since early July, growing from a low of 68E to a peak of 163E in October. While the increase in hashrate does not have an absolute positive correlation with Bitcoin's price, it does represent miner optimism about the market's future.
BTC-Puell Multiple (Source: qkl123)
In summary, we can understand the reasons behind Bitcoin setting this new all-time high and the logic behind the market's overall positive outlook. But ultimately, where will the market go? We still need to remain patient and let time reveal the answer.
Disclaimer
This article may contain product content not applicable to your region. This article is intended to provide general information only and does not accept responsibility for any factual errors or omissions. This article represents the author's personal views only and does not represent OKX's views. This article is not intended to provide any advice, including but not limited to: (i) investment advice or investment recommendations; (ii) offers or solicitations to buy, sell, or hold digital assets; or (iii) financial, accounting, legal, or tax advice. Holding digital assets (including stablecoins) involves high risk, and prices may fluctuate significantly or even become worthless. You should carefully consider whether trading or holding digital assets is suitable for you based on your financial situation. For questions specific to your circumstances, please consult your legal/tax/investment professional. The information contained in this article (including market data and statistics, where applicable) is for general reference purposes only. While we have taken all reasonable precautions in preparing this data and these charts, we do not accept any responsibility for any factual errors or omissions expressed herein. © 2025 OKX. This article may be reproduced or distributed in its entirety or used in excerpts of 100 words or less, provided that such use is non-commercial in nature. Any reproduction or distribution of the full article must prominently state: "This article is copyrighted © 2025 OKX, used with permission." Permitted excerpts must cite the article title and include the source, for example: "Article Title, [Author Name (if applicable)], © 2025 OKX." Some content may have been generated or assisted by artificial intelligence (AI) tools. Derivative works and other uses of this article are not permitted.
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