Bitcoin’s slide below $81,000 exposes why a Fed pause may not save the crypto market

On Oct. 8, Bitcoin dropped underneath $81,000, touching an intraday low around $80,800, despite traders anticipating the Federal Reserve will maintain current rates in October.

According to the September FOMC minutes published on Oct. 7, the majority of participants consider another rate increase likely before the year concludes, keeping future decisions contingent on incoming data.

Market participants continue to infer a December hike based on the projected policy trajectory, and comments made by Fed Governor Christopher Waller on Oct. 8 highlighted the extent of that horizon.

A pause delays the next hike

Waller pointed to futures pricing from Oct. 7 indicating an 85% probability of at least one rate increase by December. That same pricing reflected nearly an 80% chance of at least two hikes by March 2027 and a 33% chance of three or more.

These market-implied probabilities accumulate over time, with Waller noting that additional hikes remain probable if economic data unfold as anticipated, and that the central bank retains the flexibility to skip meetings. Opting to hold in October simply postpones the next increase, while the broader trajectory leading into 2027 remains aggressive.

By Oct. 8, the 10-year Treasury yield climbed to 5.305%, the 2-year yield stood at 4.821%, and Brent crude traded at $104.87. Sustained energy prices keep inflation risks active, whereas elevated yields maintain high capital costs for risk-oriented assets, even if the Fed bypasses a rate hike at an upcoming gathering.

A report published by Glassnode on Oct. 7 showed that combined trading volumes across spot exchanges and U.S. Bitcoin spot ETFs hovered near $6.8 billion daily, staying lower than roughly 90% of recorded observations since January 2024. Estimated fresh capital inflows from ETFs, stablecoins, and corporate treasury acquisitions reached $4.9 billion, while the realized capitalization grew by $12.8 billion over a 30-day window, accounting for less than 40% of the aggregate total.

The previous upward momentum relied heavily on existing capital simply repricing current coins, leaving the underlying buying depth too shallow to absorb heavy selling pressure.

Around the time of publication, CoinGlass figures recorded over $1 billion in total liquidations across a 24-hour period, with long positions accounting for $930 million of that sum.

Bitcoin’s $81,000 zone gave way

A day earlier, Glassnode identified a modeled concentration of long liquidations residing between $81,700 and $83,300, alongside substantial bid orders on Binance spanning from $81,000 to $81,250.

While the modeled zones illustrate where market positioning was concentrated, the recent price low indicates that the market crossed right through them. While liquidations exacerbated the price drop, interpreting macroeconomic pressures as the primary catalyst is a viable perspective, though confirming that exact sequence requires granular intraday spot-flow and liquidation metrics.

Should buyers reestablish momentum above the $85,500 reclaim threshold accompanied by stronger spot volume, Bitcoin will encounter a heavy cluster of sell orders between $86,500 and $86,750.

Directly above that band lies Glassnode’s largest one-year cluster of liquidations sitting higher than the current price, stretching from $87,100 to $95,900 with peak density near $92,000—a level where reclaiming could trigger widespread short covering and transform a policy pause into a bullish catalyst.

If buyers fail to regroup, Glassnode’s next modeled liquidation zone rests near $75,000, serving as a primary downside reference point. Key upcoming macro milestones include the September Consumer Price Index (CPI) release on Oct. 14, the FOMC meeting scheduled for Oct. 27–28, and the subsequent gathering on Dec. 8–9.

An October rate pause merely postpones the next hike, leaving Bitcoin to defend its market structure through the CPI release and two Fed meetings backed by a remarkably thin foundation of buyers.

?Frequently Asked Questions

01Why is Bitcoin falling despite expectations of a Fed pause?

Even if the Federal Reserve skips a rate hike in October, broader macroeconomic factors like high Treasury yields, persistent oil prices keeping inflation risks alive, and a shallow buyer base create a tough environment for risk assets.

02What are the key liquidation levels to watch for Bitcoin?

Glassnode data notes a modeled liquidation cluster near $75,000 on the downside. On the upside, reclaiming $85,500 could lead to test zones at $86,500 to $86,750, followed by a heavy liquidation cluster from $87,100 to $95,900.

03What upcoming economic events could impact crypto markets?

Important upcoming macro tests include the September CPI release on Oct. 14, the FOMC meetings on Oct. 27–28, and the Dec. 8–9 meeting.