bitcoin It attempted a rally late in the weekend, but even those small gains were mostly reversed in early US stocks on Monday, with the price quietly settling near the $90,000 area for the rest of the day.
Priced around $90,500 at the close of US stocks, bitcoin is down about 1% in the last 24 hours.
Major altcoins also struggled to maintain their gains. Ethereum ether fell slightly, but overcame a bit and rose to its strongest relative price against BTC in over a month. Other notable players were privacy-focused Zcash. and institution-focused blockchain Canton Network (CC), both posting double-digit gains. The broader crypto market, as measured by the CoinDesk 20 index, fell 0.8%.
While crypto action was muted, long-duration government bond yields soared amid fears that trouble in Japanese bonds would spread to other markets. The 10-year US Treasury yield rose to 4.19%, its highest level in about three months, while government debt in the UK and other European countries also sold off. Meanwhile, the 10-year Japanese bond yield continued to rise to 2%, a level not seen in almost two decades.
US stocks also fell during the day, with the S&P 500 down 0.5% and the Nasdaq down 0.3%, weighing on overall risk appetite.
This week’s key event will be the last Federal Reserve meeting of the year. While a 25 basis point cut is fully baked into expectations, messages about further guidance or other liquidity measures could drive volatility on Wednesday.
“Any easing of financial conditions or further weakening of the US dollar could provide tailwinds, while any aggressive surprises around the pace or extent of the Federal Reserve’s accommodative policy could amplify downward pressure on crypto markets,” LMAX market strategist Joel Kruger said in a note.
BTC faces structural headwinds
Despite bitcoin’s recent rebound from November lows, Bitfinex analysts warned that the largest cryptocurrency is grappling with structural weakness and weakening spot demand.
While the S&P 500 is trading near all-time highs, BTC is stuck in a range, highlighting a deepening divergence between cryptocurrencies and traditional risk assets that points to relative weakness, they noted in a report on Monday.
Bitfinex outlined several key signals that reinforce this view:
- Persistent outflows from US-listed spot bitcoin ETFs, with traders selling heavily rather than accumulating, as shown by a markedly negative Cumulative Volume Delta (CVD) on major exchanges.
- More than seven million BTC now have unrealized losses, echoing bearish sentiment similar to the 2022 consolidation period.
- While capital inflows remain slightly positive at $8.69 billion per month (as measured by net realized capitalization change), they are well below peak levels and provide only a modest buffer against downside risks.
All of those factors add up to a fragile setup heading into the end of the year, Bitfinex analysts argued.
“With spot demand weakening, the market now faces a significantly lighter buying environment,” the report said. “This reduces immediate price support and increases sensitivity to external shocks, macroeconomic volatility and any further tightening of financial conditions.”
