Historical trends in cryptocurrency markets show that periods of decline can sometimes precede a rebound. Bitcoin’s muted performance in October may represent such a pause, potentially leading to more stability before the year ends. The market has occasionally benefited from a seasonal event known as the Santa Claus Rally, a modest boost in December often driven by stronger investor sentiment and lighter trading activity. This pattern suggests that Bitcoin’s recent softness could be temporary, with a potential rebound still possible.
Despite reaching an all-time high early in October, Bitcoin’s expected rally stalled, culminating in a sharp decline later in the month. Since then, prices have begun to stabilize, indicating a potential market bottom. Investor focus is now shifting toward a possible year-end rebound. According to Coinglass, Bitcoin has closed six of the last eight Decembers with positive returns, posting gains between 8% and 46%, showing the month’s historical tendency for growth.
This stabilization is reflected in the recent move toward $106,000, which indicates that buyers are re-entering the market after a period of heavy selling. According to Nick Ruck, director at LVRG Research, market behavior is shifting from panic-driven exits to more measured purchases by long-term investors. Expectations of Federal Reserve rate cuts and growing interest from institutional participants are seen as potential drivers for a strong year-end finish.
Demand for Bitcoin has also risen on the spot market, according to Julio Moreno, Head of Research at CryptoQuant. He noted that the weekend saw a sustained increase in buying activity, the first since early October. This renewed interest, combined with reduced panic selling, may contribute to a seasonal rally often seen in December, when calmer holiday trading and stronger market confidence have historically contributed to price gains.
Market participants are also monitoring U.S. President Donald Trump’s proposal for a $2,000 “tariff dividend” payment to citizens. Augustine Fan, Head of Insights at SignalPlus, explained that the plan includes direct payments that resemble the COVID-19 relief checks, injecting additional liquidity into the system.
This infusion of cash is expected to support risk-oriented assets such as Bitcoin, and early market activity appears to reflect optimism around these initiatives.
The ‘tariff-dividends’ are reminiscent of the covid stimulus checks that were a direct and effective money-printing stimulus, while the ultra-long duration mortgages will improve housing affordability while adding extra capital leverage to the system.
So, what other factors are shaping Bitcoin’s price behavior? Analysts note that volatility is increasingly driven by market structure and investor activity rather than short-term speculation:
While the Santa Claus Rally has historically occurred in December, this year’s outlook suggests it could happen again. A year-end surge in Bitcoin prices may spark renewed momentum across altcoins, supported by seasonal trends, renewed investor confidence, and continued accumulation by long-term holders. However, these expectations remain speculative, as Bitcoin has declined nearly 2% as of today.
