The Train Doesn't Stop – Bitcoin Peaks, Volatility Returns

The Train Doesn't Stop. Bitcoin at Peak, but Volatility Strikes Back

Bitcoin broke a new record early in the week, rising above $126,000 as investors moved more aggressively into the so-called "debasement trade" – hedging against the declining purchasing power of fiat currencies. Stocks and gold followed to new highs. Japan's new Prime Minister Sanae Takaichi also added momentum to markets by promising more public spending and tax cuts.

In the US, the government shutdown continued, and little new macro data was released. Fed minutes showed a cautious stance, but rate hikes appear unlikely in October. Worrying news came from Germany with weakening industrial production and exports. In France, political chaos deepened as the Prime Minister resigned and returned just days later.

Trump and China Stir the Pot. Largest Liquidations Ever

On Thursday, China announced new export restrictions on rare earth metals, which are critical for AI and semiconductor manufacturing. Trump responded on Friday by announcing 100% tariffs on all Chinese imports starting November 1.

Markets reacted sharply: crypto and stocks plunged. Crypto markets saw the largest liquidation wave in history, with over $19 billion in positions closed in 24 hours. While the situation resembled spring's tariff news, analysts view this as a short-term shock, with a "hard cards on the table, negotiations start soon" mentality.

Crypto market's advantage is automatic, real-time settlement, which enables rapid deleveraging. Bitcoin and Ethereum showed surprising resilience, suggesting genuine demand is present. Therefore, many investors see the current correction as an opportunity to increase positions.

Looking Forward: Macro Dynamics Remain Strong

The underlying global rate-cutting cycle, rising liquidity, and growing budget deficits continue to support risk investments in the long term. Volatility may temporarily drain system liquidity, but fundamentals haven't changed. The "debasement trade" is underway with gold and Bitcoin at its center.

This correction may be the starting gun for the next upward phase, continuing through mid-term elections next year. Remember: markets follow interest rates and liquidity; everything else is noise.

Binance Japan and PayPay Join Forces

PayPay acquired a 40% stake in Binance Japan. The partnership brings a 70-million-user payment platform to crypto markets and enables PayPay for buying and selling crypto in the Binance Japan app. This is a significant step toward crypto investing becoming mainstream in Japan.

FCA Lifted Ban on Crypto ETN Products

In Britain, institutional investors can once again invest in exchange-traded crypto notes as the FCA removed its earlier ban. Retail investors, however, must wait until mid-October before they can access these products.

UK Appoints "Digital Markets Champion"

The government plans to promote securities tokenization and transition away from paper shares under the leadership of a new coordinator and working group. The goal is to bring Britain to the forefront of digital financial markets.

State Street Published 2025 Data Analysis

State Street reported that nearly 60% of institutions plan to increase their allocation to digital assets in 2025. Tokenization is seen as a strategic tool to increase liquidity and efficiency.

Luxembourg Invests in Bitcoin ETF

The country's sovereign wealth fund FSIL has allocated 1% of its assets to Bitcoin, recognizing crypto's growing role as part of digital finance. This is a significant step toward state-level acceptance.

Morgan Stanley Brings Crypto to Wealthy Clients

Morgan Stanley is preparing access to Bitcoin and Ethereum funds as part of private banking client services. This expands crypto access among wealthy investors.

Coinbase Seeks Growth in Payments

Coinbase is negotiating to acquire BVNK stablecoin service and preparing a partnership with American Express to launch a Bitcoin cashback card.

Wall Street's Stablecoin Surprise

Bank of America, Citi, and Goldman Sachs are jointly developing an institutional stablecoin as a counter to USDC and Tether. This development reinforces stablecoins' importance in the financial system.

Polymarket Founder Becomes Youngest Crypto Billionaire

Shayne Coplan, 25, is now the world's youngest self-made billionaire, having created a decentralized prediction platform where you can bet on everything from elections to weather. Polymarket has proven to be one of the most successful DeFi applications.