As the final quarter of 2025 gets underway, investors are entering a historically favorable period for crypto markets — particularly for bitcoin (BTC), which has delivered an average Q4 return of 79% since 2013.

According to a new report from CoinDesk Indices, several factors may help that trend repeat, including monetary easing, surging institutional adoption and fresh regulatory momentum in the U.S.

The backdrop is shifting fast. The Federal Reserve’s latest rate cut brought interest rates to their lowest level in nearly three years, setting the stage for broader risk-on sentiment. Institutions responded aggressively in Q3: U.S. spot bitcoin and ether (ETH) ETFs saw combined inflows of over $18 billion, while public companies now hold more than 5% of bitcoin’s total supply.

Altcoins, too, have made inroads, with over 50 listed firms now holding non-BTC tokens on their balance sheets, 40 of which joined just last quarter.

Bitcoin ended Q3 up 8%, closing at $114,000, driven largely by treasury adoption among public companies. With expectations for further rate cuts and growing interest in bitcoin as a hedge against currency debasement, CoinDesk Indices expects the asset’s momentum to continue into year-end.

But this time around, bitcoin is sharing the spotlight. Ethereum surged 66.7% in Q3, hitting a new all-time high near $5,000. That move was led by treasury accumulation and ETF flows, but future gains may hinge on November’s Fusaka upgrade which is aimed at improving scalability and network efficiency. If successful, it could reinforce Ethereum’s role as the foundation for on-chain financial activity, especially in “low-risk” DeFi.

Solana (SOL) saw a 35% quarterly gain, backed by large-scale corporate purchases and record ecosystem revenue. With new exchange-traded products launching and the Alpenglow upgrade in the pipeline, Solana is positioning itself as the high-performance layer for decentralized applications, a narrative that resonates with institutions seeking throughput and cost efficiency.

XRP, meanwhile, delivered a year-to-date gain of nearly 37%, fueled by legal clarity after the Securities and Exchange Commission (SEC) and Ripple withdrew appeals in their long-running case. Investors are watching closely as Ripple’s stablecoin RLUSD expands globally. The stablecoin’s rapid growth could draw more DeFi protocols to the XRP Ledger, deepening XRP’s utility.

Cardano (ADA) rose 41.1% in Q3, outperforming several of its peers. While activity on the chain remains relatively modest, consistent growth in stablecoin use, derivatives volume and DEX activity has created a more stable base for potential expansion. A pending decision on a spot ADA ETF could mark a turning point for institutional adoption.

The broader trend is also evident in index performance. The CoinDesk 20 Index, which tracks the 20 most liquid and tradable digital assets, gained over 30% in Q3, outpacing bitcoin. The CoinDesk 80 and CoinDesk 100, which capture mid- and small-cap assets, also posted strong returns, reflecting growing interest across the market cap spectrum.

Looking ahead, the approval of generic listing standards for crypto ETFs and the emergence of multi-asset and staking-based ETPs could further accelerate inflows. For traders, Q4 presents a unique mix: a favorable macro environment, deepening institutional engagement and renewed interest in altcoins.

China’s Ministry of Commerce (MOFCOM) says its new rare-earth export controls are lawful national-security steps — not blanket bans — and that licenses will be issued for eligible civilian trade, according to a spokesperson’s Q&A posted on X Sunday morning local time.

Rare earths — a group of 17 elements used in permanent-magnet motors for electric vehicles (EVs) and wind turbines, defense electronics and other high-tech gear — occupy an outsized role in supply chains because China dominates the sector.

Beijing accounts for roughly 70% of global production and about 90% of processing and refining; so licensing shifts can ripple downstream even when mining or final manufacturing happens elsewhere.

In remarks published only hours ago, the MOFCOM spokesperson framed the Oct. 9 action — taken with the General Administration of Customs — as part of a longer effort to “refine” China’s export control system in line with domestic law and non-proliferation obligations.

The spokesperson cited the military relevance of medium- and heavy rare earths and said partners were notified in advance through bilateral export-control dialogue mechanisms.

Implementation, the ministry said, will hinge on licensing rather than prohibition.

Reviews will be conducted under law, licenses will be granted where applications qualify, and Beijing is “actively considering” facilitation measures — including potential general licenses and license exemptions — to promote legitimate trade.

The spokesperson also said China had assessed the measures’ effects ahead of time and expects the broader supply-chain impact to be “very limited.” The message to commercial users was explicit: compliant civilian exports “can get approval.”

Responding to Washington — while leaving room for talks

MOFCOM also addressed President Donald Trump’s comments from Oct. 10 on Truth Social about an additional 100% tariff on Chinese imports (becoming effective Nov. 1, 2025) and prospective U.S. export controls on “critical software.”

The spokesperson called the American position a “double standard,” pointing to the breadth of U.S. control lists and de minimis rules as examples of Washington’s expansive approach.

At the same time, the ministry emphasized process, saying China “does not want” a trade war but “is not afraid” of one, and urging a return to established consultation channels to manage differences on a reciprocal basis. The spokesperson said China would take “resolute measures” to protect its interests if the U.S. proceeds.

Separate comments criticized U.S. port fees due to take effect Oct. 14 on certain Chinese-linked vessels.

MOFCOM described those fees as unilateral and inconsistent with WTO rules and bilateral agreements. China, the ministry said, will levy special port fees on U.S.-linked vessels under domestic regulations — characterizing the step as a defensive countermeasure aimed at safeguarding the rights of Chinese companies and maintaining fair competition in shipping.

As of Sunday, 9:15 a.m. UTC, according to CoinDesk Data, bitcoin traded around $111,271, down 0.5% in the past 24 hours and 10% from Thursday’s Oct. 9 intraday high of $123,641. The Crypto Fear & Greed Index read 24 — «Extreme Fear» — versus «Greed» a week ago, underscoring fragile sentiment.

Friday’s sell-off triggered what Bitwise portfolio manager Jonathan Man called the worst liquidation event in crypto history, with more than $20 billion wiped out as liquidity vanished and forced deleveraging took hold, in an article on X published Saturday.

Perpetual futures — “perps” in trading shorthand — are cash-settled contracts with no expiry that mirror spot via funding payments, not delivery. Profits and losses net against a shared margin pool, which is why, in stress, venues may need to reallocate exposure quickly to keep books balanced.

Man, who is the lead portfolio manager of the Bitwise Multi-Strategy Alpha Fund, said bitcoin fell 13% from peak to trough in a single hour, while losses in long-tail tokens were far steeper — he added that ATOM “fell to virtually zero” on some venues before rebounding.

He estimated roughly $65 billion in open interest was erased, resetting positioning to levels last seen in July. The headline numbers, he argued, mattered less than the plumbing: when uncertainty spikes, liquidity providers widen quotes or step back to manage inventory and capital, organic liquidations stop clearing at bankruptcy prices, and venues turn to emergency tools.

According to Man, exchanges in that situation leaned on safety valves.

He said auto-deleveraging kicked in at some venues, forcibly closing part of profitable counter-positions when there was not enough cash on the losing side to pay winners.

He also pointed to liquidity vaults that absorb distressed flow — Hyperliquid’s HLP “had an extremely profitable day,” he said, buying at deep discounts and selling into spikes.

What failed and what held

Man said centralized venues saw the most dramatic dislocations as order books thinned, which is why long-tail tokens broke harder than bitcoin and ether.

By contrast, he said DeFi liquidations were muted for two reasons: major lending protocols tend to accept blue-chip collateral such as BTC and ETH, and Aave and Morpho “hardcoded USDe’s price to $1,” limiting cascade risk.

Although USDe remained solvent, he said it traded around $0.65 on centralized exchanges amid illiquidity — leaving users who posted it as margin on those venues vulnerable to liquidation.

Beyond directional traders, Man highlighted hidden exposures for market-neutral funds. He said the real risks on days like Friday are operational — algorithms running, exchanges staying up, accurate marks, the ability to move margin and execute hedges on time.

He checked in with several managers who reported they were fine, but said he would not be surprised if “some c-tier trading teams got carried out.”

Man also described unusually wide dispersion across venues, citing $300-plus spreads at times between Binance and Hyperliquid on ETH-USD.

Prices recovered from extreme lows, he said, and positioning flushes created opportunities for traders with dry powder. Man also mentioned that with open interest down sharply, markets entered the weekend on firmer footing than the day before.