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1. Bitcoin Holds $80,000 as Traders Wait for the Fed
Bitcoin (BTC) held steady near $80,400 on Monday, October 26, after dipping to about $79,300 during the Asian morning, as a pullback in oil prices eased pressure on markets and traders waited for the Federal Reserve's policy decision on Wednesday. Ether (ETH) slipped 0.2 percent, and a decentralized finance index was the only major crypto benchmark to post a gain.
The session was notable mainly for its calm. Price moves were small, liquidations fell sharply and funding rates stayed only mildly positive, which points to a market that is waiting for news rather than reacting to it. The central bank meeting and a heavy slate of corporate earnings later in the week are the events most likely to break that stillness.
Beneath the quiet surface, however, there were several threads worth following: the departure of a prominent trader from directional positions, a retreat in crude oil on hopes of diplomacy with Iran, a new bout of outflows from spot bitcoin exchange-traded funds and unusual strength in a handful of DeFi tokens.
2. Why Did DeFi Outperform?
The decentralized finance index rose while every other major index was flat or lower, and the gains came despite heavy selling by a well-known investor. Arthur Hayes' fund, Maelstrom, sold its entire directional book over the weekend, including 6,400 ether, citing macroeconomic and geopolitical risk.
The fund also sold about 323,000 Uniswap (UNI) tokens on Saturday and roughly 14 million Ethena (ENA) tokens. Even so, UNI rose 1.9 percent and ENA gained about 1 percent. Strength in the face of visible selling is often read as a sign that buyers were willing to absorb the supply, though a single day is not a trend.
The episode shows how closely traders follow the portfolios of high-profile figures. A fund moving to cash can heighten caution across the market, yet in this case the reaction in tokens linked to the fund's sales was muted. DeFi's relative performance suggests investors were selective rather than broadly defensive.
3. How Oil and Geopolitics Shaped the Session
Equity futures offered a modest lift. S&P 500 futures rose about 0.3 percent following Friday's selloff in U.S. stocks. Energy markets moved lower as well: U.S. crude fell about 2 percent to near $101 a barrel, and Brent crude slid to roughly $110.
The decline was linked to diplomacy surrounding Iran. Qatari mediators arrived in Tehran on Sunday, and President Donald Trump said no strike would take place that day, although he did not rule one out. Oil had recently touched six-month highs, and a pullback eases worries about inflation, which matters for any asset sensitive to interest rates.
For bitcoin, the connection runs through monetary policy. Higher energy costs can push up consumer prices, which in turn makes the Federal Reserve less willing to cut rates and more willing to raise them. A retreat in crude therefore reduces, at the margin, the pressure on the central bank, and that explains why traders watched oil as closely as crypto-specific news.
4. What Is the Fed Expected to Do on Wednesday?
The Federal Reserve raised interest rates in September and meets again on Wednesday. Pricing on the CME FedWatch tool shows a 90 percent probability that it leaves rates unchanged this week, while the odds of another increase in December stand near 80 percent.
That combination, a hold now with a likely hike to follow, explains the cautious tone. Traders are less focused on the decision itself than on the language that accompanies it, since guidance about December can move yields, the dollar and risk assets within minutes. Bitcoin has tended to trade as a risk asset, so tighter policy expectations generally weigh on it.
A hawkish tone could push bitcoin toward the lower end of its recent range, while a softer message could support a recovery. Because the outcome of the meeting is largely priced in, the surprise potential lies in the committee's description of future moves.
5. Spot Bitcoin ETFs Lose Another $138 Million
Flows into products that hold bitcoin directly turned negative again. According to data from Farside Investors, spot bitcoin ETFs saw $138 million in outflows on Friday, extending a two-day exit to $772 million.
ETF flows are a closely watched indicator of institutional demand because the funds give traditional investors a regulated route to bitcoin. Sustained withdrawals can signal that large allocators are reducing exposure, and they remove a source of steady buying that supported prices earlier in the year.
Two days of outflows do not by themselves establish a trend. Flows frequently reverse, and a decision from the Fed could prompt allocators to return. Still, the figures add to the sense that institutional participants are holding back before the central bank speaks.
6. What Derivatives Markets Show
Positioning data indicate a market without a crowded side. Total futures open interest rose 0.85 percent to $139.9 billion over 24 hours, while trading volume fell 1.78 percent. Liquidations dropped 71 percent to $153 million, and taker volume was almost evenly split, with 50.34 percent on the long side and 49.66 percent on the short side.
Bitcoin's price rose 0.20 percent, its open interest rose 0.84 percent and its volume dropped 7.21 percent. Ether's open interest increased 0.45 percent alongside a 0.23 percent price gain. Funding rates were mildly positive across the major tokens, a sign that long positions are not paying a steep premium to stay open.
Options activity leaned cautious. The busiest bitcoin contract was the October 28 put at a $77,000 strike, followed by the October 28 call at $84,000. The one-month put skew eased to about 12.5 percent from about 14.5 percent. In ether options, four of the six most active contracts were puts, led by the October 29 strike at $2,000, and the one-week skew narrowed to about 8.7 percent from about 13.3 percent.
Put skew measures how much more expensive downside protection is than equivalent upside exposure. A fall in skew means the premium for protection is shrinking, which suggests that fear is receding somewhat even as traders continue to hedge.
7. How to Read a Quiet Market
Calm sessions can be as informative as volatile ones. Open interest, the total value of outstanding futures contracts, rose slightly while volume fell, meaning traders added to positions without a burst of new trading. Liquidations, which occur when leveraged positions are forced closed, dropped by almost three quarters, indicating that few traders were caught on the wrong side of a sudden move.
Funding rates add another layer. In perpetual futures, traders on one side pay the other a periodic fee that keeps the contract close to the spot price. Mildly positive funding means longs pay shorts a small amount, which is typical in a market with slightly more bullish than bearish positioning, but a large positive rate would suggest crowded long trades that are vulnerable to a sharp reversal. Readings this week showed no such crowding.
Taken together, these indicators describe a market that is balanced and cautious. Without leverage-driven pressure in either direction, the price is likely to respond mainly to outside events. That is why the Federal Reserve meeting, oil headlines and earnings carry more weight than usual, and why a break below the roughly $79,300 overnight low or above the $84,000 option strike would be read as a signal that sentiment has shifted.
8. Altcoin Moves: Zcash, Ethena, Hyperliquid and AI Tokens
Several smaller tokens attracted attention. Zcash (ZEC) rose 3.84 percent with open interest up 8.17 percent and volume up 19.11 percent. Ethena's ENA gained 8.36 percent on the day, with open interest jumping 16.85 percent and volume surging 81.51 percent. Cumulative volume delta, a gauge of whether buyers or sellers are more aggressive, was positive for Monero, Zcash, Solana and a few others, and negative for Dogecoin, Chainlink, Hyperliquid and Stellar.
Tokens tied to artificial intelligence moved lower. Grass (GRASS) fell 2.7 percent and NEAR lost 1.4 percent, following a Sunday warning from Elon Musk that lenders have reduced credit to roughly 200 cloud providers that focus only on AI.
Hyperliquid's HYPE token rose about 1 percent after Hyperliquid Strategies, a Nasdaq-listed company holding the token under the ticker PURR, said it will more than triple its share buyback to $100 million. The program applies only to the company's own shares, not to the token. Crude oil perpetual futures were the only top-20 market with negative funding, at minus 0.0077 percent, as the price fell 1.55 percent. The CoinMarketCap Altcoin Season index stood at 53 out of 100, down from 58 on Friday.
9. What to Watch Next
All eyes turn to Wednesday's Federal Reserve announcement and the commentary that follows. Traders will look for any change in guidance about a December increase, since the market already prices a strong chance of one.
Corporate earnings from major technology companies this week will also test sentiment toward the artificial intelligence boom, which has been linked to risk appetite across both equities and crypto. In the background, the diplomatic talks involving Iran could swing oil prices in either direction. Any surprise in those areas could quickly change the tone of a market that has so far moved within a narrow range.
For now, bitcoin remains pinned near $80,000, with options traders hedging on the downside near $77,000 and positioning for upside toward $84,000. A decisive move away from that band would likely come from the Fed or from energy markets rather than from anything specific to crypto.