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October closed about 4% down for Bitcoinbut venture funding reached $5.1 billion in the same month, the second strongest month since 2022.
According to CryptoRank data, three mega-deals account for most of this, as October challenged its own seasonal mythology.
Bitcoin fell 3.7% during a month traders dubbed “Uptober” for its historic winning streak, breaking a pattern that has held since 2019.
However, venture capitalists invested $5.1 billion in crypto startups during the same 31 days, marking the second strongest monthly total since 2022 and the best VC performance of 2025 outside of March.
The divergence between the weakness of the spot market and the strength of the venture market creates a puzzle, where the builders see something that the traders have missed, or a lot of huge controls have distorted the signal.
Concentration tells most of the story. Three transactions represent about $2.8 billion of the October total of $5.1 billion: the strategic strategy of Intercontinental Exchange (ICE). investment up to $2 billion in PolymarketTempo’s $500 million Series A round led by Stripe and Paradigmand Kalshi’s $300 million Series D round.
CryptoRank’s monthly data shows 180 funding rounds disclosed in October, indicating that the top three transactions account for 54% of the total capital deployed in less than 2% of businesses.
The median round size is likely in the single digit millions. Elimination of Polymarket, Tempo, and Kalshi from the calculation will change the narrative from “the best month in years” to “a steady but unspectacular continuation of the modest pace of 2024”.
The “venture recovery” narrative depends a lot on whether people count a strategic acquisition play by the parent company of the New York Stock Exchange and two infrastructure bets as representatives of the wider confidence of the builder or as outliers that closed in the same reporting window.
Because spot traders were selling while VCs were writing checks
Bitcoin’s October weakness stemmed from profit-taking after September’s gains, macroeconomic headwinds from rising Treasury yields, and continued ETF flows that began in the middle of the month and accelerated in the last week.
Although Bitcoin ETFs recorded nearly $3.4 billion in net inflows, Farside Investors the daily flow data shows heavy ransoms from the main Bitcoin spot products, particularly in the last ten trading days.
Venture capital operates on a different clock. Firms deploying capital in October committed to positions led by theses months earlier.
The current money transfer and timing of the announcement reflects legal processes and strategic coordination rather than spot market sentiment.
Polymarket’s $2 billion from ICE does not reflect a bet on the November price of Bitcoin, but rather reflects ICE’s opinion that prediction markets represent a multi-billion dollar addressable market where first mover advantage and regulatory positioning matter more than token price action.
Time for $500 million stablecoin round funds and payment infrastructure aimed at enterprise adoption. Products that generate income whose success metrics are not directly correlated with Bitcoin trading at $100,000, $60,000 or $40,000.
Kalshi’s $300 million raise operates in similar territory. The CFTC-regulated prediction market platform competes with Polymarket and traditional derivatives venues, and its valuation jumped to $5 billion based on the growth of transaction volume and a regulatory moat, rather than the timing of the crypto market.
October’s three biggest deals share a common thread: they target infrastructure, compliance and institutional use cases where crypto serves as plumbing rather than speculation.
This focus explains why venture activity can increase while retail traders exit, since VCs made their bets on the development of the financial infrastructure of decades, not the movement of the prices of the next quarter.
The risks in mega-deal concentration
Concentration creates fragility. If Polymarket faces regulatory headwinds, or if Tempo’s business pipeline develops more slowly than expected, two of October’s flagship deals could mark milestones rather than validated milestones.
The same concentration that inflated October’s numbers makes the sector vulnerable to downward revisions if these few big bets falter.
The timing also deserves caution. ICE announced its Polymarket investment days before the US mayoral election, positioning the platform to capitalize on what has become the record volume of the prediction market.
That timing reflects strategic opportunism, as ICE has gained high visibility and user growth, but raises questions about sustained engagement if election-driven volume returns to normal.
Kalshi’s $300 million came at a similar time to the election. Both trades can be prescient if the prediction markets support post-election activity, or they can represent peak-hype prices if volumes crater once the binary political events resolve.
If the pattern of October holds, with weak retail, rotating institutions, concentrated infrastructure bets, the winners will not be the projects that capture the speculative frenzy, but the platforms that become institutions of utility layers cannot avoid.
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