4 Reasons Why Bitcoin (BTC) Dumped by $23,000 in 10 Days

BTC fell below $104,000 on Friday.

Remember the “Uptober” story? October, the month that starts the fourth quarter, promises to be a bullish month. Expectations were also high for the 2025 edition.

And it all started well when BTC exploded out of the gate and spiked above $126,000 to chart a new all-time high. So it had added more than $16,000 in value in just ten days. However, things turned around just as quickly, and over the next ten days the currency lost even more ground against the dollar. Here are some of the possible reasons behind this massive crash.

Trump-led uncertainty

The main price decline, which occurred at the end of the previous business week, was largely attributed to global political uncertainty prompted by US President Donald Trump. The POTUS threatened China with a new wave of tariffs after accusing its authorities of a lack of transparency in certain areas.

While such threats have occurred occasionally since he took office, BTC responded with an immediate correction from over $122,000 to under $117,000. The situation deteriorated in the following hours, especially as futures positions began to break down in an over-leveraged market.

The results were violent, to say the least, as Bitcoin fell to $110,000 on some exchanges, and all the way to $101,000 on others. What’s particularly interesting here is that the entire disaster could have been one big misunderstanding between the two superpowers. Reports began to emerge that it had been exaggerated, and tension subsided in the following days. With this, the price of BTC recovered to $116,000.

The focus then shifted to another combustible geopolitical theater: the war between Ukraine and Russia. On Thursday, Trump met with Russia’s Putin, and BTC began to lose traction as the meeting took place. On Friday, the POTUS received a visit from the Ukrainian Volodymyr Zelenskyy. Reports indicated that the Ukrainian leader might not receive the requested Tomahawk cruise missiles.

It’s also worth mentioning the US government shutdown, which has been going on for over two weeks now.

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American banking crisis?

The US banking system saw shadows of Silicon Valley Bank’s failure in 2023 when two regional organizations – Zions Bancorp and Western Alliance – published some controversial data that stoked fear among investors. The former disclosed a $50 million charge-off related to two commercial loans in California, while the latter initiated a fraud case against a borrower, raising questions about the quality of its loan portfolio.

Investors were scared not only in the US, but also in the United States also in Asia and Europe, as shown by the invade share prices on Friday for major banks such as Deutsche Bank, Barclays and Société Générale.

Although BTC is supposed to be the answer to cracks in the traditional financial system, such crises tend to be damaging to the system, especially in the short term.

ETF Exodus

After an impressive nine-day period beginning in late September, during which spot Bitcoin ETFs attracted nearly $6 billion, the trend reversed at the end of the previous business week, with a small net outflow of $4.5 million.

However, the recordings intensified on Monday ($326.4 million), Wednesday ($104.1 million), and especially on Thursday, when more than $530 million left these financial products. Friday was also in the red: more than 366 million dollars left the fund.

Total withdrawals from US-based ETFs exceeded $1.2 billion this week, undoubtedly increasing pressure on the underlying asset.

Gold up, BTC down

In times of uncertainty, investors tend to flock to safe havens. Although this year has had its ups and downs, they have shown a slightly different approach. Gold has been the investment vehicle of choice for many, evidenced by its massive rally in 2025.

It’s charting new all-time highs almost daily, most recently near $4,400/oz on Friday. At the same time, BTC’s performance has been quite disappointing lately. This could prove that critics like Peter Schiff are right (at least for now) that the precious metal is still favored, even though many BTC proponents have argued over the past decade that the cryptocurrency is “digital gold.”