After a slight pullback at the start of the week, the leading cryptocurrency seemed to pause to catch its breath. On Wednesday, BTC prices remained virtually unchanged, falling by a mere 0.7% to $83,380. The market is currently experiencing a temporary lull: investors are trying to make sense of the pause in the U.S. Treasury bond rally and are assessing the risks associated with the geopolitical situation in the Middle East.
But this brief pause does nothing to detract from the overall picture. Bitcoin is closing out the third quarter with a truly impressive result.
42 percent for the quarter: the best gain in two years
By the end of September, Bitcoin had surged by as much as 42% over three months. For “digital gold,” this is the strongest growth since late 2024.
Why did this happen? In my view, three main factors came into play:
First, U.S. regulators began to take a softer stance. Positive signals from the SEC helped the market weather the setback caused by Congress’s failure to pass the Clarity Act.
Second, demand for safe-haven assets increased. When Treasury yields began to rise, doubts about U.S. government debt began to creep in. As a result, institutional investors began shifting funds into gold and Bitcoin.
Third, a major player entered the market. Strategy Inc (MSTR) methodically bought up bitcoins throughout the quarter, instilling confidence in other buyers.
What’s Holding Back the Rally: Fed Rates and Geopolitics
Despite the optimism, macroeconomic factors are currently preventing Bitcoin from reaching new all-time highs.
On the one hand, the Fed is maintaining a hawkish stance. Due to its “hawkish” rhetoric, the yield on 10-year U.S. Treasury bonds remains above 5.2%, which is nearly a 19-year high. When high returns can be earned on risk-free government debt, demand for risky crypto assets traditionally falls.
On the other hand, the situation surrounding the U.S. and Iran remains extremely uncertain. Rumors of a possible peace deal in exchange for concessions from Tehran have not been confirmed, and tensions around the Strait of Hormuz continue to weigh on global markets.
Altseason in the Third Quarter: Chainlink Leads the Way, DeFi on the Rise
While Bitcoin is holding steady at $83,000, altcoins have even slightly outperformed it this quarter.
Chainlink (LINK) emerged as the real star, nearly doubling in price with a gain of almost 100%. Investors are betting on the growth of DeFi and tokenization, and without Chainlink’s infrastructure, that growth would be impossible.
Ethereum (ETH), although it dipped 1.5% on Wednesday to $2,665, still soared nearly 70% over the quarter. Cardano (ADA) posted similar results, gaining about 70%.
XRP is ending the quarter with a 44.2% gain, while BNB is set to post a 39% increase. Even meme coins are keeping pace: Dogecoin (DOGE) has risen 30% over the past three months.
However, the overall picture in the market remains mixed. Many coins have yet to move into positive territory since the start of the year, as a significant portion of speculative capital is currently flowing into hyped projects related to artificial intelligence.