The Start of Bitcoin's Bear Market: Analyzing the Data from October 10, 2025

October 10, 2025, is recognized as the official start of Bitcoin's bear market, triggered by an unprecedented liquidation event in crypto derivatives. This article explores how this significant date led to a drastic reduction in open interest and overall market conditions, affecting speculation and trading volume in the cryptocurrency market.

Key Takeaways

October 10, 2025, marked the start of Bitcoin’s bear market, fueled by a massive derivatives liquidation event.
About 70,000 BTC in open interest was lost in a single day, reflecting a significant shift in market structure.
Liquidity issues and decreased speculation are contributing to prolonged market stagnation.
Bitcoin's trading volumes have substantially declined, indicating weaker demand compared to previous months.
Analysts caution that recovery will depend on improved liquidity and increased trading activity.

Bitcoin price news

Understanding the Bear Market Trigger: October 10

On October 10, 2025, Bitcoin's market conditions dramatically changed when the largest crypto derivatives liquidation event recorded saw approximately $19 billion in futures positions unwound. This event, according to CryptoQuant contributor Darkfost, was critical not only in terms of price decrease but also in structural damage to the market.

The number of open futures contracts diminished drastically, falling by around 70,000 BTC in just one day. Darkfost notes that this level of liquidation wiped out months of leveraged positions, making it challenging for the market to rebound. He states that the incident “really pushed BTC into a bear market” due to the rapid and extensive loss of liquidity in futures trading.

Open interest in Bitcoin | Source: X @Darkfost_Coc

The Aftermath of the October 10 Event

Darkfost highlights that the October 10 selloff led to a significant reduction in open interest, returning to levels not seen since April 2025. In his analysis, he explains, “The equivalent of over six months of Open Interest accumulation was erased in one session.” Following this event, the open interest has struggled to recover, indicating a sluggish market atmosphere.

The implications of this are not merely about the initial selloff but also the market’s ability to maintain leveraged trading. With liquidity severely impacted, the analogy Darkfost uses is that the crypto market's capacity for speculative activity is being compressed, making it hard for investors to return with confidence.

Bitcoin Capital echoed this sentiment, stating, “After 10/10, nothing felt the same,” indicating a broken state within the market structure. Furthermore, Darkfost bluntly remarked, “It needs to be rebuilt, and this could take months.”

Bitcoin spot trading volume | Source: X @Darkfost_Coc

Broader Liquidity Concerns

In a consequent analysis, Darkfost expanded his observations beyond just derivatives, noting that trading in the spot market has also cooled off significantly. As Bitcoin entered its fifth month of price correction, the impacts of the October 10 event on futures liquidity were considerable but not the sole cause of the market's downturn.

According to his data, average outflows of stablecoins from exchanges have occurred alongside a roughly $10 billion drop in total stablecoin market capitalization, thus adding more challenges for traders who are looking to take risks, particularly amid a backdrop of de-leveraging.

Since October 2025, daily trading volumes for Bitcoin have plummeted by nearly 50%. Binance remains the leader in trading volume, with $104 billion, a stark drop from a near-record high of almost $200 billion in October. Other platforms like Gate.io ($53 billion) and Bybit ($47 billion) also saw significant decreases.

Darkfost described this contraction in trading activity as returning to levels not seen since 2024, interpreting it as a sign of decreased demand rather than just a fleeting pause in the market's activity.

Current Market Position

As of the latest data, Bitcoin is priced at $78,723, indicating that recovery efforts will depend heavily on observing liquidity conditions and, importantly, a rebound in spot trading volumes.

Bitcoin price chart
Bitcoin remains above the 1.0 Fibonacci level | Source: BTCUSDT on TradingView.com