Bitcoins Wild Ride: From $108K to $92K (Market Update)

Its not always roses and rainbows in the cryptocurrency market and even though it may have felt like it for the past few weeks, the last seven days made sure to remind us of it. The total capitalization dropped by more than $300 billion as Bitcoins price went on a complete rollercoaster, similar to that of the majority of altcoins.

The first few days of the week started as we are more or less used to by know up only. Bitcoins price tapped a new all-time high above $108,000 and the market was anticipating the results of the meeting of the US Federal Result. Quite frankly, everyone was expecting for the institution to once again cut the interest rates, which is generally perceived as a positive move as far as risk-on assets go. Oh, if it were true this time around.

During the meeting, the Chairman Jerome Powell said that they might consider a slowdown of rate cuts, given that the inflation in the country is rising. This propelled a market-wide sell-off across the crypto industry but also across tradfi as the majority of indices also dropped considerably.

More interestingly, Powell addressed the possibility of Bitcoin becoming a reserve asset for the country, saying that the Federal Reserve is legally prohibited from holding it. This might put a dent into Trumps plans and it appears that investors didnt like it as the cryptocurrency is now trading below $100K, having plummetted to around $92,000 earlier today.

The sell-off also triggered over $1.3 billion worth of liquidated positions across the cryptocurrency market on Friday alone.

The majority of altcoins are trading in the red, with Ethereum down almost 15%, XRP 10%, BNB 8%, Solana -15%, DOGE 25%, and so forth.

As its almost always the case, a lot of people in the community are already speculating whether or not the bull run is over, but during times like these its really important to zoom out and keep a steady eye on the bigger picture.

In any case, if one thing is sure, its that the next few weeks are likely to be quite interesting, so lets see how it goes!

Market Data

Source: Quantify Crypto

Market Cap: $3.45T | 24H Vol: $482B | BTC Dominance: 55.3%

BTC: $96,552 (-4.5%) | ETH: $3,370 ( -15% ) | XRP: $2.21 (-10%)

This Weeks Headlines You Cant Miss

MicroStrategy Announces First Bitcoin Purchase With BTC Prices Above $100K. It wouldnt be a Monday these days if the Michael Saylor-founded business intelligence giant didnt announce a massive BTC purchase. In this weeks example, the company allocated $1.5 billion to accumulate 15,350 BTC at an average price of just over $100,000.

XRP Price on the Move as Ripple Announces Stablecoin Launch on Dec 17. Although it continues with its legal tussle against the US securities watchdog, Ripple entered the stablecoin industry this week by finally launching its own product called RLUSD. The token release was on December 17, and it positively impacted XRPs price at the time.

This Cohort of Ethereum Whales Accumulates Record 57.35% of Supply. Ethereum whales have been on an accumulation spree lately, according to on-chain data. The number of large wallets holding at least 100,000 ETH has jumped to an all-time high of over 57% of the entire supply.

BlackRocks IBIT Nearly Doubles Gold ETFs 20-Year AUM Milestone in Less Than 12 Months. The worlds largest Bitcoin ETF continues to shatter records. Its AUM has skyrocketed in the past 11 months to almost $60 billion as of December 19, which dwarfed the performance of the companys biggest gold-based ETF.

Bitcoin Price Tumbles Toward $100K Despite Feds Latest Rate Cut. The entire financial field expected another rate cut at the end of 2024, and thats what they got. However, the hawkish words by Jerome Powell about potentially stopping the rate reductions in 2025 sent the ever-volatile and risky crypto market down hard. At first, BTC tumbled toward $100,000 but quickly lost that level and dumped all the way south to $92,100, leading to speculations about whether this bull market has ended.

Fed Effect: Biggest Net Outflow Day for Bitcoin ETFs Led to Crash Below $96K. Powells aforementioned comments seemingly scared US investors out of their BTC positions, which is particularly true for the spot Bitcoin ETFs. The financial vehicles recorded their worst day in terms of daily net outflows on the day after the FOMC meeting (December 19), with nearly $700 million being withdrawn.

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Text source: CryptoPotato

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