Wall Street Pulls Back After Bitcoin’s Rally Spikes, Says 10x’s Thielen

Bitcoin’s recent momentum may be changing as Wall Street-style options hedging, systematic trading, and whale profit-taking cool the kind of uninterrupted, rapid price rises that defined earlier cycles, according to 10x Research founder Markus Thielen.

In the latest episode of Cointelegraph’s Trade Secrets, Thielen argues that Bitcoin is now more likely to respond in bursts to macro headlines—rising quickly on news before “crab walking” across charts until the next major economic catalyst.

Key takeaways

• Thielen says Wall Street call-option selling and hedging structures have reduced the odds of consecutive double-digit Bitcoin rallies.
• He estimates up to half of net spot Bitcoin ETF inflows may be associated with market-making hedges rather than direct, directional spot accumulation.
• Thielen still projects Bitcoin could reach $90,000 by year-end, with a pullback into the mid-to-high $70,000s possible first.
• He expects Ethereum to lag because he believes too much economic value from on-chain activity flows to layer-2 networks, while ETH holders may not capture enough.
• Thielen points to the Fed’s path for rates as a key driver of whether the market can sustain a year-end push.

Why Bitcoin’s rally rhythm may look different now

Thielen’s central claim is that Bitcoin’s “violent price explosions” have become less frequent. He ties this to how institutional participation has evolved—particularly around options positioning and profit-taking after rallies. In his view, the market’s mechanics matter as much as the headline news itself.

Earlier in the cycle, Bitcoin tended to see faster, more sustained upward moves. Thielen contrasts that pattern with what he expects today: an event-driven market that reacts sharply when economic data or Federal Reserve signals shift expectations, followed by a period of consolidation as traders manage risk.

He also frames the difference in participants across cycles. In writing his book Crypto Titans, Thielen says he noticed that each cycle brings new “promoters,” and those promoters draw in different kinds of investors. This time, he argues, much of the pitch is coming from Wall Street—investors who trade with macro data and Fed decisions in mind.

Spot Bitcoin ETFs: inflows may not equal straightforward buying

Thielen said he analyzed roughly $60 billion in net spot Bitcoin ETF inflows and estimated that market makers account for up to half of those inflows. His reasoning is that some market-making desks hold ETF shares as a way to hedge related options positions, meaning the ETF holdings may not reflect a pure belief that Bitcoin’s price will rise.

As he put it, the activity can be “not outright buying.” His estimate is based on a review of Form 13F filings, which disclose certain securities holdings of investment managers.

Thielen also noted that early ETF inflows were not exclusively institutional hedging. He said retail investors were part of the demand stream indirectly—buying through institutions and corporate vehicles—and that some participants appeared willing to pay substantial premiums relative to the underlying value.

Looking ahead, he suggested that additional institutional and large allocations could still arrive, including the possibility of capital from sovereign wealth funds, while reiterating that investors should distinguish between hedged positioning and directional accumulation.

Bitcoin’s path to $90,000 hinges on rates—and consolidation

Despite his caution about the market’s rally tempo, Thielen still sees Bitcoin climbing to $90,000 by year-end. He also suggested that the market may not go straight there: he expects a dip into the mid-to-high $70,000s could come before any renewed push higher.

At the time of the discussion, Bitcoin was trading in that broader range. The article notes Bitcoin was around $76,100 on Friday following news related to Binance’s $6.3 billion hack, and that October ended down 7.3% according to Coinglass data cited in the piece.

Thielen compared the current rebound environment to early 2023. Then, Bitcoin recovered from roughly $20,000 to $30,000, and he says investors can sound the same skeptical notes now—searching for the next dip and the next “entry point” rather than assuming the trend will continue smoothly.

For Thielen, the Federal Reserve is a key variable. He highlighted that the central bank raised its benchmark rate by a quarter point in September, moving the target range to 3.75%–4%. The Fed then held rates steady in a split vote, with the statement indicating inflation remained elevated and leaving room for further hikes.

Thielen’s expectation is that there will be another hike by December, followed by a more cautious approach afterward. He argues that this sequence could support a market that trends upward toward year-end—especially if traders start to price in a less aggressive path for future tightening.

Ethereum’s challenge: turning network use into returns for ETH holders

Thielen also argued that Bitcoin may outperform Ether because, in his view, too much of the economic value generated by Ethereum activity is captured by layer-2 networks rather than accruing to ETH holders.

He framed the issue as one of incentives: reducing transaction costs on Ethereum has been a deliberate objective, but cheaper usage can weaken the investment story for ETH itself. Ethereum burns base fees paid by users, which reduces circulating supply when burns outpace issuance. However, if network activity becomes cheaper in a way that lowers the burn, the supply impact may be less supportive.

He said he has been bearish on Ether for more than a year and compared Ethereum to a highway—one that everyone wants to keep clear so they can travel quickly, while questioning who should pay for that upkeep. In his analogy, the network needs to remain “clean and fixed,” but users and the market may be unwilling to value that maintenance as an investment.

Thielen pointed to Hyperliquid as an example of a structure where trading activity can directly fund token economics. In that case, the exchange’s assistance fund converts trading fees into HYPE, which is then burned. His broader point was that Ethereum needs a stronger connection between network usage and financial benefit for holders of ETH, not just network scaling and lower costs.

Investors watching this debate should focus on two areas: how much ETF-related activity is genuine directional demand versus hedged market-making, and whether the Fed’s rate trajectory shifts the market from consolidation into a sustained year-end trend—while Ethereum’s relative underperformance will likely depend on whether ETH holders capture more value as scaling continues.