Bitcoin rose by 43% in Q3 2026, its best showing in a Q3 since 2017.
From 2013 to 2025, the crypto posted average Q4 returns of 72%.
Bitcoin is a highly cyclical asset, and now appears to be moving into the "boom" phase of its usual four-year cycle.
If you're a Bitcoin (CRYPTO: BTC) investor, there are plenty of reasons to be optimistic about what the next 12 months will bring. The cryptocurrency just turned in its best Q3 since 2017 (when it gained 80% in that quarter), and finally seems to have regained its mojo.
If history is any guide, Bitcoin could be setting up for a spectacular rally next year.
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Looking back at the historical data, the third quarter has gained the reputation for being the worst quarter of the year for Bitcoin. That's based on data going all the way back to 2013. On average, it gained slightly less than 9% in Q3s.
A gain of 9% might sound impressive, but it badly lags the averages of other quarters. For example, Bitcoin averaged a gain of 46% in Q1, a gain of 24% in Q2, and a gain of 72% in Q4. That's why its rise of 43% in Q3 2026 was so impressive.
Numbers can be deceiving, however. While Bitcoin has averaged a gain of 9% for the quarter, that does not mean that Q3 is always the worst quarter of the year. For example, take last year. Bitcoin posted a modest gain in Q3 before completely falling off the cliff in Q4. In other years, Bitcoin's Q1 has been the worst quarter of the year. So, if you're relying on historical data, understand that there are some nuances here.
Image source: Getty Images.
That being said, Q4 is typically the best quarter of the year for Bitcoin, based on average return data. We're now in October, which Bitcoin investors like to refer to as "Uptober" because uptrends during the month are so common. In nine of the past 11 years, Bitcoin has notched a gain in October.
Putting it all together, it now appears that the bottom is in for Bitcoin. During July, the coin briefly dipped below $60,000, and many investors thought it was in real trouble. But since then, it has rallied back to the neighborhood of $85,000.
Bigger gains could be ahead. In fact, some investors think Bitcoin could hit $100,000 by year's end.
Bitcoin typically trades in four-year boom-and-bust cycles. This may be oversimplifying things, but three good years are typically followed by one very bad year. And that's exactly what the past 12 months have been for Bitcoin -- a very bad year. Bitcoin is still down 34% from the all-time high of $126,000 it set in October 2025.
But Bitcoin's positive performance in Q3 would appear to suggest that it is now entering the bullish phase of its cycle. In other words, it appears poised to go on a prolonged, multiyear rally that will take it to new all-time highs.
The historical pattern paints a bullish picture for Bitcoin. But just remember -- past performance is no guarantee of future results. There are no fundamental reasons why Bitcoin usually ends the year on a high note, nor why Q3 has historically been so difficult for it.
Maybe it's just an artifact of the data. Average returns are just that -- an "average" of returns over a multi-year period. Depending on which time period you use, the return data can look significantly different.
But if Bitcoin embarks on a monster Q4 rally like its previous behavior suggests it will, then the crypto bears are going to be in for a long winter.
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Dominic Basulto has positions in Bitcoin. The Motley Fool has positions in and recommends Bitcoin. The Motley Fool has a disclosure policy.