What's next for Bitcoin (BTC) price if it consolidates past $120,000?

In October, Bitcoin (BTC) has once again exceeded expectations, raising past $125,000 to reach unprecedented highs. Despite having plunged below $120K following the massive crypto liquidation event on October 12, it is regaining dominance in terms of relative value (against ETH and other altcoins) as it stages a muted recovery back towards its former high.

Bitcoin's historic rally: What changed

Bitcoin's latest rise to record highs is the result of several bullish factors converging at the right moment. It has doubled in value over the past year, climbing from around $62,000 to over $125,000, with particularly strong momentum in the opening week of October.

Three major forces have contributed to this rally: 

• Federal Reserve policy shifts
• Unprecedented institutional adoption
• Growing concerns about traditional currency stability 

The U.S. Federal Reserve's recent signals on additional interest rate cuts have been significant. Following Jerome Powell’s Fed Symposium speech in September, roughly half of policymakers expect two more rate cuts by the end of 2025.

This dovish stance has triggered gains across multiple asset classes, and Bitcoin stood out. When the Fed eases monetary policy, the U.S. Dollar tends to lose its shine, leaving investors looking for alternative stores of value. And unlike fiat, Bitcoin enjoys a fixed supply of 21 million coins.

Alongside retail demand, the scale of institutional participation has been headline worthy. More deep-pocketed companies, major financial institutions and even sovereign wealth funds are pouring billions into BTC through spot exchange-traded funds.

Spot BTC ETFs recorded $3.2 billion in inflows during a single week this month, representing the second-highest total since these products launched in January 2024. The record-setting single-day ETF inflows was at over $1.2 billion, coinciding with BTC hitting its all-time high of $126,198.

BlackRock's iShares Bitcoin Trust ETF is one of the fastest growing funds in history, as it reached $80 billion in assets under management in record time. 

Roughly 6.7% of Bitcoin's total supply is now locked up in ETFs, with major corporate holders like Strategy controlling another 3%. This means nearly 10% of all Bitcoin that will ever exist is held by institutional players committed to long-term holdings rather than short-term trading.

Further, approximately $15 billion worth of Bitcoin has left centralized exchanges like Binance and Coinbase over just two weeks. Exchange balances have trended lower as tokens move to long-term storage and institutional custody, reducing readily available supply.

This signals long-term conviction over speculative trading.

The debasement trade

The U.S. Dollar Index notched a double-digit decline earlier this year, while gold and silver have ripped to record highs at $4,000 per ounce and above $50 respectively in recent days.

Bitcoin's gains mirror this flight to hard assets, suggesting investors view the ‘digital gold’ as a hedge against monetary instability. Like physical gold, they are characterized by limited supply and no central authority. The U.S. government shutdown that began on 1 October has intensified these concerns, undermining confidence in traditional government assets and pushing capital toward alternatives. 

BTC advocates have long argued for advantages over the physical metal. For example, it's easier to transfer, harder to confiscate and more verifiable through transparent blockchain records. 

While gold's $27 trillion market capitalization dwarfs Bitcoin's approximately $2.5 trillion, the cryptocurrency's rapid growth suggests it could capture an increasing share of the safe-haven asset market.

BlackRock, the world's largest asset manager, recently characterized BTC as a ‘unique diversifier’ with relatively low correlation to stocks. The firm noted that BTC has, more often, risen in six out of six major global crises within 60 days since 2020, and at higher rates than gold. Morgan Stanley’s Global Investment Committee is even encouraging clients to allocate up to 4% of their portfolios to crypto assets.

It’s important to note that BTC’s history is still considered by many to be volatile, with several sharp drawdowns including an 80% drop in 2017 to 2018 and a 75% crash over the course of late-2021 to 2022. These cyclical peaks have occurred roughly four years apart.

However, past performance is not a guarantee of future results. And the scale of new institutional participation, the maturation of regulated investment products, and the macro backdrop of currency concerns suggest this may be more than another speculative bubble.

How to buy Bitcoin in five easy steps

Looking to buy Bitcoin online? We make starting simple:

1. Choose a trusted crypto platform. Select a reputable exchange like Crypto.com with strong security and positive customer reviews.
2. Create an account. Sign up with your email, complete KYC verification, and set up two-factor authentication.
3. Deposit funds. Add funds using a bank transfer, debit/credit card, or other supported payment methods.
4. Purchase Bitcoin. Search for BTC on the platform and place a buy order.
5. Secure your BTC. Either let us handle the storage or transfer to a non-custodial wallet of your choice for peace of mind.

Need more detail? Check out our full guide to buying Bitcoin.

Disclaimer: This is informational content sponsored by Crypto.com and should not be considered as investment advice. Trading cryptocurrencies carries risks, such as price volatility and market risks. Before deciding to trade cryptocurrencies, consider your risk appetite. Services, features and other benefits referenced in this article may be subject to eligibility requirements, token holdings, and may change at the discretion of Crypto.com.  

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