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Bitcoin’s early-week recovery stalled as rising oil prices, Treasury yields and dollar strength—amplified by fears of US-Iran conflict—pressured risk assets. Bitcoin fell below $81,000 on Oct. 9, triggering roughly $1.1 billion in liquidations, before rebounding near $82,000 after President Trump ruled out an Iran strike before the midterms. Spot bitcoin and ether ETFs recorded heavy outflows, though flows varied across the week. The selloff underscored persistent leverage and volatility risks despite deeper bitcoin and ether order books than a year ago.[15][17][22][1]

Regulators moved on several fronts. US agencies proposed crypto rules after Congress failed to advance the CLARITY bill, while FinCEN withdrew proposed reporting rules for mixers and private-wallet transfers. In Europe, ESMA gave platforms three months to address stablecoins that do not comply with MiCA; the UK sanctioned exchanges and payment firms over alleged Russian sanctions evasion. France’s committee backed proposed taxes on stablecoin swaps and some unrealized gains.[75][69][28][11][12]

Tokenization and mainstream financial integration gathered momentum, with plans for tokenized US stocks on Solana and through an OKX-ICE venture. Samsung prepared USDC transfers for Galaxy users, while Thailand finalized rules allowing bitcoin and ether ETFs. Banks and crypto firms also pursued custody, settlement and stablecoin services, signaling expansion beyond trading, even as several Ethereum layer-2 networks announced closures after failing to find sustainable demand.[30][88][37][41][57]

Security concerns intensified: Ledger investigated reports of $86 million in theft linked to reseller-sold devices, and the XRP Ledger issued an emergency patch for a serious bug. Warnings about potential AI attacks on wallet cryptography prompted debate, with Europol urging phased post-quantum preparations. Separately, US authorities planned a major Iran-linked crypto seizure, underscoring digital assets’ growing role in sanctions enforcement.[8][4][32][45][5]