Volatility cools as ETFs anchor confidence in a cautious market

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Introduction

Global markets spent the past week balancing softer inflation expectations, uneven growth, and the extended U.S. government shutdown. With official data suspended, investors turned to alternative indicators such as consumer sentiment and central bank guidance. The University of Michigan’s confidence index held at 55.0, while one-year inflation expectations eased slightly to 4.6%.

In Europe, Germany’s ZEW index improved, and the ECB reaffirmed that policy rates remain “sufficiently robust.” China surprised with stronger trade figures, while Japan’s wholesale inflation quickened, fuelling talk of a Bank of Japan rate hike later this month. Meanwhile, Australia’s consumer sentiment weakened as the RBA maintained its steady stance.

Across both traditional and digital markets, sentiment appears to have stabilised but still alert. Inflation and growth trends remain uneven, yet ETF demand and institutional flows continue to underpin crypto’s resilience, suggesting investors are positioning through uncertainty rather than stepping aside.

Check prices on the BTC Markets exchange.

State of crypto

• Bitcoin steadies above US$111K after US$19B liquidation flush, with ETF inflows at US$2.7B
• Ethereum rebounds 7.5% to near US$4.1K as ETF flows turn positive and sentiment improves
• Solana climbs 6.6% to US$205, supported by ETF speculation and ecosystem strength
• XRP eases 12.7% to around US$2.5 as traders await clarity on potential ETF developments
• Total crypto market cap holds near US$3.75T, with volumes above US$240B despite volatility

Bitcoin steadies above US$111K after US$19B liquidation flush, with ETF inflows at US$2.7B

Bitcoin (BTC) spent the week consolidating after the record US$19 billion liquidation event on 10 October, the largest single-day wipeout in crypto history. BTC traded in a tight range between US$111K and US$115K as traders reassessed leverage exposure. Despite the shock, ETF inflows remained strong at US$2.72 billion for the week, bringing total cumulative inflows to US$62.5 billion and signalling early signs of renewed institutional confidence. With BTC holding above its 200-day moving average near US$107K, the broader uptrend remains intact, though short-term volatility could persist amid ongoing US-China trade tensions.

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Ethereum rebounds 7.5% to near US$4.1K as ETF flows turn positive and sentiment improves

Following Bitcoin’s stabilisation, Ethereum (ETH) also saw a solid rebound, gaining 7.5% to trade near US$4.1K. Renewed ETF inflows and improving sentiment helped offset last week’s sharp drawdown, with cumulative inflows reaching US$25 billion. While ETH remains below its 50-day moving average near US$4.2K and RSI readings suggest soft momentum, it continues to hold well above its 200-day moving average around US$3.17K. Any adverse macro news, however, could prompt a retest of short-term support near US$3.5K.

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Solana climbs 6.6% to US$205, supported by ETF speculation and ecosystem strength

Strength in major assets also lifted leading altcoins, with Solana (SOL) climbing 6.6% to around US$205 amid renewed speculation over a potential SOL ETF and growing ecosystem activity. The token remains above key support at its 200-day moving average around US$173, reflecting steady capital inflows and rising investor interest in higher-beta assets. On the daily chart, SOL trades between its 50-day and 200-day moving averages, suggesting consolidation within a broader uptrend.

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XRP eases 12.7% to around US$2.5 as traders await clarity on potential ETF developments

Meanwhile, XRP lagged broader market gains, easing 12.7% over the week to around US$2.50. The token continues to consolidate below its 200-day moving average near US$2.58, with RSI levels around 45 indicating neutral sentiment. Traders are closely watching for updates on potential XRP ETF developments, which could act as a catalyst for renewed institutional interest.

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Total crypto market cap holds near US$3.75T, with volumes above US$240B despite volatility

Across the broader market, total crypto capitalisation stands near US$3.75 trillion, down from early-month highs above US$4.3 trillion, while trading volumes remain elevated at US$243 billion. Bitcoin’s dominance eased to 59.1% from last week’s 63% peak, reflecting deeper drawdowns across altcoins. Despite this, institutional flows continue to anchor sentiment, and selective recoveries in assets like Solana and Chainlink signal early signs of stabilisation. Overall, markets appear to be in a cautious recovery phase, awaiting fresh macro catalysts.

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Crypto Fear & Greed Index

Source: Fear & Greed Index

BTC Markets in the news

AFR: Crypto’s ‘catastrophic’ crash comes as Australian bets pass $1b mark

Charlie Sherry, Head of Finance at BTC Markets, said “with so much leverage concentrated in shallow markets, even a moderate sell-off snowballed into a full-blown crash,” adding that poor risk management made the impact “catastrophic.”

Outgoing CEO Caroline Bowler noted that SMSFs are “operating with the discipline of institutions – executing larger trades, applying structured diversification, and taking a long-term view.”

Cointelegraph: BNB mindshare spikes 251% in a week, as markets eye low-cost chains

Speaking to Cointelegraph, Rachael Lucas, an analyst at Australian cryptocurrency exchange BTC Markets, said the surge in sentiment is likely due to BNB benefiting from a shift in market focus toward high-throughput, low-cost chains with active ecosystems.

Livewire: When the leverage breaks: What the weekend crypto crash revealed

In his latest article on Livewire Markets, BTC Markets’ Head of Finance Charlie Sherry breaks down how the weekend’s violent deleveraging exposed fragile market structure and the risks of excessive leverage.

Announcements

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You can access your new portfolio via the ‘Get started’ link below or by clicking the 'Simple Trade' link in the navigation bar on the exchange platform.

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Australia FIX Conference 2025

The Australia FIX Trading Community Conference will take place in Sydney on 22 October. This year’s agenda showcases high-level conversations on market structure, evolving regulations, and the technologies shaping the future of trading.

Rachael Lucas, Head of Marketing & Communications at BTC Markets, will join the panel “Digital Assets & Tokenization: A Strategic Side Note” to share her perspective on crypto’s role in modern market infrastructure.

Learn more

Exclusive crypto tax discounts available for BTC Markets users

BTC Markets has partnered once again with leading crypto tax software providers - Crypto Tax Calculator, Koinly, and Syla - to help make tax time easier (and more affordable) for our clients.

Take advantage of these exclusive offers and simplify your crypto tax reporting this financial year.

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The week ahead: Economic events

Thursday, October 16th 

• United Kingdom Monthly GDP MoM

Monday, October 20th 

• China GDP Annual Growth Rate, Industrial Production, Retail Sales YoY

Tuesday, October 21st

• Canada Inflation Rate

Wednesday, October 22nd

• Japan Balance of Trade
• United Kingdom Inflation Rate

Source: Trading Economics

Market reflections

• United States: Limited data amid shutdown keeps markets cautious
• Eurozone: Optimism improves but household spending stays weak
• China: Trade beats forecasts but deflation persists
• Japan: Inflation uptick renews speculation of a rate hike
• Australia: Sentiment slips as RBA maintains cautious stance

United States: Limited data amid shutdown keeps markets cautious

With no official releases due to the government shutdown, investors turned to private indicators such as the University of Michigan’s consumer survey. Sentiment held steady at 55.0, while one-year inflation expectations eased to 4.6%.

The Federal Reserve has already cut rates by 25 basis points to a range of 4%-4.25%, with another potential cut flagged for late October. Chair Jerome Powell noted firmer growth but a softer labour market, tempering expectations of further easing. Bond yields slipped to 4.03%, gold hit new highs, and equities remained volatile amid renewed U.S.-China trade tensions.

Why it matters for crypto: Lower yields and a softer dollar generally support risk assets, but the lack of official data increases uncertainty, a mix that can heighten crypto volatility.

Eurozone: Optimism improves but spending remains subdued

Germany’s ZEW survey showed stronger sentiment at 39.3 but persistently weak current conditions at -80.0. The European Central Bank’s minutes reaffirmed that policy rates remain “sufficiently robust,” while high household savings suggest consumers remain cautious.

Why it matters for crypto: Cautious central bank guidance limits growth prospects but supports low real yields, which can sustain interest in alternative assets such as crypto.

China: Trade data beats forecasts but deflation lingers

China’s latest trade data outperformed expectations, with exports up 8.3% year on year and imports rising 7.4%, narrowing the trade surplus to US$90.45 billion. However, CPI inflation fell 0.3%, and PPI declined 2.3%, underscoring persistent deflationary pressures.

Why it matters for crypto: Stronger trade improves global risk sentiment, but domestic deflation could increase Chinese demand for non-sovereign stores of value like Bitcoin.

Japan: Inflation uptick renews talk of potential rate hike

Wholesale inflation rose 2.7% in September, fuelling expectations of a possible Bank of Japan rate increase later this year. The yen weakened to around ¥151.7 per USD, while yields edged closer to 0.8%.

Why it matters for crypto: Rising domestic rates could reduce yen-carry trades and encourage Japanese investors to diversify into digital assets.

Australia: Sentiment slips as RBA maintains cautious stance

Consumer sentiment fell 3.5%to 92.1, marking a second straight monthly decline. The Reserve Bank of Australia left the cash rate steady at 3.60%, signalling no urgency to ease. Ten-year yields hovered near 4.3%, and markets now see a 50-50 chance of a November cut.

Why it matters for crypto: A cautious RBA stance and lingering inflation pressures may dampen speculative appetite, though the stability of the Australian dollar helps limit volatility in AUD-denominated crypto holdings.

Across regions, the macro narrative remains mixed, defined by moderate disinflation, cautious central bank policy, and uneven growth. For digital assets, this backdrop supports accumulation on dips rather than aggressive risk-taking, as markets await clearer signals on rates and liquidity.

Closing thoughts: Poised for the next phase

Markets are transitioning into a consolidation phase ahead of clearer direction. Softer inflation and uneven growth indicate that major central banks are nearing the end of their tightening cycles, opening the door to improved liquidity in the coming months.

In crypto, steady ETF inflows and growing institutional participation are laying the groundwork for a more sustainable recovery. Focus is shifting toward quality projects and long-term fundamentals as short-term speculation cools.

The next catalyst is likely to emerge from fresh monetary or macro signals, which could determine how capital flows back into digital assets through year-end.

Scam alert

Threat and extortion scams: Don’t give in to pressure

Scammers are increasingly using intimidation to steal money or personal details. They may threaten arrest, deportation, harm, or public exposure - often while pretending to be government officials, police, or other trusted authorities.

These scams usually start with a call, email, or message claiming you owe money and must pay immediately. Some even threaten to release private photos or sensitive information unless you comply. The goal is simple: to scare you into acting before verifying if it’s real.

Warning signs 

• Unexpected contact claiming you owe money or face legal trouble.
• Pressure to pay immediately through cryptocurrency, gift cards, or unusual methods.
• Requests for personal or financial information.
• Threats involving police, immigration, or other government agencies.
• Emails or messages that sound urgent, aggressive, or demanding.

How to stay safe 

• End contact straight away. Hang up, delete the message, or block the sender.
• Never share personal details or make a payment without confirming the request.
• Verify any claims directly with the organisation using official contact details.
• Report the scam to authorities or Scamwatch.
• Secure your accounts immediately if you’ve shared information or made a payment.

Protect yourself and others. Learn more at scamwatch.gov.au.

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