Bitcoin Rebounds to $112K as Market Recovers From Slump

Bitcoin’s Monday morning recovery to $112,000 marked a significant turnaround from last week’s price slump, with the top cryptocurrency gaining 2.5% in the past 24 hours according to CoinGecko data. This rebound undid most of last Thursday’s losses and triggered a broader market rally that saw altcoins soar higher, resulting in $354 million in liquidations and pushing the total cryptocurrency market capitalization toward the $4 trillion mark. Farzam Ehsani, CEO and co-founder of VALR, told Decrypt that Bitcoin’s rise reflected “a mix of macro relief, with a softer U.S. dollar and steadier rate expectations, alongside a cleaned-up leverage after recent liquidations and renewed accumulation from larger players.”

The recovery was particularly notable given the substantial outflows from sophisticated trading products during the previous week. CME-based Bitcoin futures and options products saw a combined $4.33 billion decline in open interest between September 18 and 26, with futures falling by $2.83 billion to $14.73 billion between September 18 and 25, while options dropped by $1.50 billion to $4.63 billion over the following two days according to Velo data. U.S. spot Bitcoin exchange-traded funds also experienced net outflows as part of what Singapore-based trading desk QCP Capital described in its Monday post as a “quarter-end basis unwind.”

While institutional traders using CME’s regulated products engaged in quarter-end rebalancing, crypto-native investors demonstrated remarkable resilience. Perpetual traders in the cryptocurrency space doubled down despite last week’s brutal liquidation events, driving an $800 million uptick in open interest for Bitcoin’s perpetuals from $42.8 billion to $43.6 billion, coupled with positive funding rates. QCP Capital noted that “optimism is re-emerging” in this segment of the market, highlighting the divergence between traditional financial rebalancing activities and crypto-native sentiment.

Experts who previously spoke to Decrypt emphasized that the ETF outflows were not indicative of market weakness but rather reflected sophisticated trading strategies. The simultaneous growth in perpetual open interest and positive funding rates suggested underlying strength in the market, with crypto-native investors viewing the price dip as a buying opportunity rather than a reason for concern. This divergence between institutional quarter-end activities and perpetual trader optimism created a complex market dynamic that ultimately supported Bitcoin’s recovery.

Market participants remain divided on Bitcoin’s near-term trajectory despite the strong recovery. On prediction market Myriad, launched by Decrypt’s parent company DASTAN, users expect Bitcoin to close out September above $105,000 but place a 57% chance on Bitcoin dipping to $105,000 rather than surging to $125,000, continuing a broadly bearish trend that kicked off with last week’s price slump. This cautious sentiment persists even as Bitcoin prepares to enter a historically bullish fourth quarter with median returns of 52%.

All eyes are now focused on September’s Nonfarm Payrolls data, scheduled for Friday, which could be delayed if the U.S. government shuts down. Shawn Young, chief analyst of MEXC Research, told Decrypt that “Bitcoin will continue to anchor sentiment, especially with the halving narrative getting closer,” highlighting the importance of both macroeconomic factors and Bitcoin-specific catalysts in shaping market direction. The combination of historical seasonal patterns, the approaching halving event, and ongoing macroeconomic uncertainty creates a complex backdrop for Bitcoin’s price action in the coming months.