Each year, as September wraps up, crypto fans get ready for Uptober—a month where BTC typically sets new records, altcoins make massive gains, and the biggest decision isn’t about which delivery app to use, but what color the next Lambo should be.
Each year, as September wraps up, crypto fans get ready for Uptober—a month where BTC typically sets new records, altcoins make massive gains, and the biggest decision isn’t about which delivery app to use, but what color the next Lambo should be.
However, markets need more than just luck to climb—catalysts usually provide the momentum.
In the crypto world, people have noticed that rapid price movements often align with specific months. For instance, late December, with its holiday cheer, brings increased volatility, while May sees a dip as major players cash out for the summer break.
Crypto traders have come up with catchy names and sayings for various months. In December, you’ll hear about the “Santa Claus Rally,” and in May, the phrase is “Sell in May and go away.”
October has earned a reputation for sparking bullish momentum, which is why it’s now dubbed “Uptober.”
The Stats Behind Uptober
If you take a look at Bitcoin’s monthly performance stats, a pattern becomes clear: fall, especially the 4th quarter, tends to be the most rewarding time of year. And that starts with October.
Bitcoin’s average return in the 4th quarter stands at an impressive 81.4%.
For comparison: the 3rd quarter averages a return of 6.03%, the 2nd quarter comes in at 26.9%, and the 1st quarter stands at 56.5%.
Bitcoin Monthly Performance. Source: coinglass.com
As the table shows, in the last 12 years, BTC has only had negative performance twice in October. The only other month with similar results is February.
However, February’s average return is nearly 25% lower than October’s: while February sees an average growth of 15.6%, October enjoys a 21% rise.
That’s why October has earned the title of Uptober in the crypto world.
But let’s talk about the most important catalysts for 2024.
The U.S. Presidential Election
While the U.S. presidential election will take place on November 5, 2024, its market effects may be felt earlier, in October. The popular trading phrase “Buy the rumor, sell the news” suggests that speculation about the election could boost prices, but the election results themselves may cause a drop.
One thing is certain: the presidency will go to either Trump or Harris. Their respective chances of winning can be tracked via the "Presidential Election Winner 2024" bets on Polymarket.
Details on Polymarket’s “Presidential Election Winner 2024.” Source: polymarket.com
At the time of writing, 53.2% of users were betting on Trump’s victory, while 46.2% believed Harris would win. The remaining 0.6% is divided among other candidates. Trading volume has already exceeded $1 billion, and it’s likely to hit $1.5 billion soon.
Both candidates are generally seen by the crypto community as positive for the market. The only question is the scale of the potential impact.
On one side, Kamala Harris’ comments on cryptocurrencies are a sharp departure from the hostility of current U.S. President Joe Biden. She has emphasized her desire to keep the U.S. at the forefront of niches like blockchain, AI, and quantum computing, stating that these sectors “will define the next century.”
In contrast, Trump plans to go further by making the U.S. the “world capital for crypto and Bitcoin.” During the Bitcoin 2024 conference in July, he presented his vision of BTC becoming a reserve currency for the U.S. Treasury. He also promised to fire SEC chairman Gary Gensler on his first day in office.
Trump’s crypto activity doesn’t stop there: he launched his own NFTs, backed World Financial Liberty, a DeFi project spearheaded by his sons, and even publicly paid for burgers using BTC.
As a result, a Trump win would likely generate stronger market optimism than a Harris victory. Although Kamala is unlikely to harm the crypto sector, the positive impact of her leadership would probably be more modest.
Impact of Fed Rate Adjustments
Despite the Federal Reserve's rate cut in September, many analysts, including those at JPMorgan, argue that the market has not yet seen the expected positive effects.
Typically, lower interest rates drive up the value of riskier assets, but the correlation between cryptocurrency market capitalization and Fed rates remains weak—just 0.46.
“We have yet to see the ‘pop’ in cryptocurrency prices expected from lower rates since the Fed’s September 18 cut,” the report observes.
Interestingly, the Fed’s rate cut may have a stronger influence on altcoins than Bitcoin. If we look at BTC dominance alongside Ethereum’s gas prices, we see that after the Fed meeting, BTC dominance fell, while Ethereum gas fees surged.
BTC dominance decline and Ethereum gas price surge post-Fed meeting. Source: 10xresearch.co
A drop in BTC dominance reflects capital flowing into altcoins, while higher Ethereum gas fees indicate increased blockchain activity. More frequent blockchain use means greater competition for transaction validation, driving up fees.
JPMorgan also acknowledges that the lack of long-term data (compared to traditional markets) complicates understanding the real correlation between cryptocurrencies and Fed rate cuts.
Bitcoin, which is only 15 years old, came into existence when Fed rates were near zero. Therefore, some experts speculate that stability in rates may benefit the crypto market more than rate reductions.
Stablecoin Minting and the Rise of Chinese Investors
By the end of September, Bitcoin had broken free from its extended downtrend, momentarily surpassing the $65,000 level. Analysts at 10x Research suggest that if this level holds, BTC could swiftly rise toward $70,000, eventually reaching a new all-time high.
Bitcoin breaks free from a prolonged downtrend. Source: 10xresearch.co
The report discusses several drivers behind the growth of crypto assets, including the minting of new stablecoins and Chinese market incentives.
For instance, the industry saw roughly $10 billion in new stablecoins minted in just two weeks. This fresh liquidity could contribute to higher crypto prices, as stablecoins are often used to buy assets like BTC, ETH, and other altcoins.
According to 10xresearch, 40% of the recent stablecoin inflows were in USDC. Unlike USDT, which is mainly used to preserve the dollar value of portfolios, USDC minting is more commonly used by institutional investors for trading purposes.
This could signal an impending increase in DeFi activity, often associated with crypto price rallies.
At the time of writing, the combined market cap of all stablecoins sits at $159 billion.
Correlation between stablecoin market cap and BTC price. Source: glassnode.com
The 10xresearch report also explores the possible influence of China’s economic stimulus plan. They believe that part of the $278 million earmarked by the Chinese government could flow into the crypto sector, possibly sparking further asset growth.
Institutional Demand for Bitcoin and Ethereum ETFs
The Bitcoin ETFs, approved in January 2024, have seen remarkable interest from institutional investors, which a recent report from Glassnode described as “phenomenal.”
At the time of writing, the total net value of bitcoins held by spot Bitcoin ETFs stands at $58 billion, roughly 4.7% of Bitcoin’s total market cap.
Net daily inflows and allocations across different Bitcoin ETFs. Source: sosovalue.com
Since Bitcoin and Ethereum ETFs are still relatively new investment landscape options, their current demand might be underappreciated. As institutional interest in these ETFs grows, it could have a favorable impact on the price of BTC and ETH.
Another growth catalyst could be the introduction of options trading on spot Bitcoin ETFs. This approach provides a dynamic way for investors to engage with ETFs, funneling liquidity into the base asset.
In mid-September, the SEC approved the listing and trading of options on BlackRock’s iShares Bitcoin Trust spot ETF on Nasdaq. However, the final decision hinges on approval from the Options Clearing Corporation and the Commodity Futures Trading Commission.
Ethereum’s Pectra Upgrade
The upcoming Ethereum update, known as “Pectra,” represents more than just a short-term catalyst for ETH—it's a major step toward evolving the blockchain’s functionality.
The update will implement more than 30 proposals, including:
- Expanding validator staking limits from 32 ETH to 2048 ETH;
- Optimizing the Ethereum Virtual Machine (EVM) at both Layer 1 and Layer 2 levels;
- Replacing the current account abstraction standard (EIP-3074) with the new EIP-7702.
Ethereum’s developers plan to roll out the first phase of Pectra in early 2025, with the second phase following in the subsequent months. Although the update isn’t coming in October, it could still drive positive investor sentiment.
Will "Uptober" slip into "Selltober" or "Octobear"?
The first week of October saw a shift in crypto sentiment from "Uptober" to "Selltober" and "Octobear". When the much-anticipated parabolic rise didn't materialize at the start of Q4, traders started ringing alarm bells as the market's capitalization dropped by 7%.
Analytics from Santiment show that mentions of "Uptober" on social media have decreased compared to early October levels.
While this downward trend is unsettling, similar declines in community activity often signal temporary capitulation, creating opportunities for a short-term market rebound.
Uptober Took Its Time in 2023
As of October 9, 2024, Uptober is still MIA: BTC is hovering between $62,000 and $63,000, altcoins aren’t showing any 300% spikes, and social media isn’t buzzing with green P&L screenshots.
While the pessimists seem resigned to the situation, the optimists are combing through last year’s price action in search of bullish signs.
In October 2023, BTC climbed 6% in the first two days, only to lose 7.3% by the 11th. However, it rebounded, finishing the month with a 35% gain at its peak.
BTC price movement in October 2023 vs. possible movement in October 2024. Source: tradingview.com
If the pattern holds, October 11 could mark a low point, setting the stage for a sharp rally (as seen in the chart above).
Which of the catalysts in this article will end up being the decisive one? Will any?
That’s still up in the air. If Uptober happens, the luckiest crypto traders could be shopping for their New Year’s Lambo. If not, they’ll definitely have some laughs with the flood of memes on X. Those are guaranteed.
