⚡️ The Quick Pulse: What Moved Markets Last Week
Risk‑off kicks December into reverse. Crypto started December with a steep draw‑down. On December 1st, Bitcoin (BTC) tumbled 6% to as low as $83,879, triggering $1 billion in liquidations. Reuters attributed the slump to a sharp rise in global yields and risk‑aversion following hawkish hints from the Bank of Japan and a negative S&P Global report on Tether. Altcoins underperformed, with liquidity drying up. This setback reminds traders that crypto remains highly sensitive to macro flows.
Sentiment flips as good news piles up. By mid‑week, the market mood improved. On December 3rd the total crypto market cap rebounded 7.4% to $3.24 trillion, led by BTC (+7% to $92,992) and ETH (+9.1% to $3,055). Positive catalysts included: Vanguard reopening access to BTC ETFs for 50 million clients, Bank of America allowing advisers to recommend a 1–4% crypto allocation and the United Kingdom formally recognizing digital assets as legal property. Altcoins staged powerful rallies with Solana +12.1%, Dogecoin +11.3% and DeFi names such as Sui (+30.8%) and Chainlink (+19.6%).
Ethereum treasury activity. On December 8th, BitMine Immersion Technologies (Tom Lee’s firm) disclosed the purchase of $429 million of ETH, its largest buy in two months. BitMine’s treasury now holds ≈$12 billion in ETH, and the firm said it bought the dip as ETH rallied almost 11% week‑over‑week.
Macro data offered mixed signals. The ISM services PMI held at 52.6 in November, but new orders softened and services employment contracted for the sixth month, pointing to a K‑shaped U.S. economy where higher‑income households continue to spend. The ADP employment report showed private payrolls fell by 32,000 in November, the first decline since early 2021. Delayed consumer spending data (due to a government shutdown) showed PCE inflation up 0.3% m/m and 2.8% y/y, while real consumption rose 0.3%. Markets interpreted the softening labour data and contained inflation as support for Fed easing expectations, lifting risk assets.
Rates expectations dominate. Interest‑rate markets ended the week pricing an 87% probability of a 25‑bp Fed rate cut at the December FOMC meeting. The resulting anticipation produced choppy price action: risk assets firmed into the weekend but volatility remained elevated ahead of the crucial policy decision.
Crypto | Price (USD) | W/W View* |
|---|---|---|
Bitcoin (BTC) | ~$90,800 | Rebounded from the $83.9k lows; remains ~2% below Tuesday’s $92,992 high |
Ethereum (ETH) | ~$3,100 | Up ~11% w/w thanks to BitMine’s pruchase and renewed ETH ETF inflows |
Solana (SOL) | ~$134 | Up double-digits w/w but still down >40% from highs |
*Approximate comparison versus prices on Dec. 1st
📰 Crypto News & Narratives
Institutional flows: Vanguard re‑enabled BTC ETF purchases for its retail clients, and Bank of America authorised its advisers to recommend a 1–4% allocation to crypto. Those policy shifts combined with speculation that former CEA chair Kevin Hassett could become the next Fed chair sparked discussion of a new institutional adoption cycle.
Regulatory clarity: The U.K. passed legislation formally recognizing crypto assets and stablecoins as personal property. Observers expect clearer property rights to facilitate institutional custody and collateralized lending.
Tether downgrade: S&P Global’s rating of Tether was cut to BB‑, citing opacity of reserves and legal uncertainties. The headline contributed to the early‑week sell‑off but had little lasting impact.
Technical catalysts: Ethereum developers signaled readiness to activate the Fusaka upgrade in January, a major improvement that introduces stateless signatures. Traders expect the upgrade to reduce network fees and support rollups.
🏦 Financial Markets Update
Equities: U.S. stocks wobbled with the S&P 500 finishing the week marginally lower as investors positioned ahead of the FOMC. Global equities also softened amid BoJ‑driven volatility.
Rates: Treasury yields edged higher during the early‑week sell‑off but retraced some gains as soft labour data fueled cut expectations. 10‑year yields hovered around 4.15%.
Commodities: Crude oil slid toward $68 per barrel on concerns that slowing demand and a stronger dollar would offset OPEC+ supply cuts. Gold held near $2,125 per ounce as traders weighed the coming rate cut.
🗓️ Macro Events to Watch (Dec. 9th – 12th 2025)
Date | Event | Why It Matters |
|---|---|---|
Tuesday - Dec. 9th | FOMC meeting begins; NFIB Small Business Optimism Index, Productivity & Costs, JOLTS job openings | Early indicators of labour-market slack and business sentiment. The FOMC begins its two‑day meeting amid elevated cut expectations. |
Wednesday - Dec. 10th | FOMC Announcement (2pm EST) and Fed Chair press conference (2:30pm EST) | Markets expect a 25‑bp cut. The tone of Chair Powell’s Q&A will determine whether the Fed signals further easing or a one‑and‑done cut. |
Thursday - Dec. 11th | International trade in goods & services, Weekly jobless claims, Producer Price Index (PPI) | Data on trade and producer prices will show whether goods‑sector inflation continues to cool. Jobless claims will be closely watched for signs of labour market softness. |
Friday - Dec. 12th | Michigan Consumer Sentiment | Provides an early read on household confidence heading into year‑end. |
💡 Trading Desk Insight
December is shaping up to be a macro‑driven month. Crypto traded as a high‑beta proxy for global liquidity rather than a stand‑alone asset class. The early‑week rout reminded traders that position sizing and risk management are paramount when macro catalysts such as BoJ policy shifts or Tether downgrades can trigger swift liquidations. The mid‑week bounce underscored how quickly sentiment can flip when institutional adoption headlines emerge and rate‑cut odds climb.
The FOMC meeting is this week’s focal point. Market pricing implies an 87% probability of a 25‑bp cut. The committee is divided: hawkish members want to pause, while Governor Stephen Miran will argue for a 50‑bp cut. Sentiment expects the Fed to compromise with a 25‑bp “hawkish cut” and maintain a median dot around 3.375% (implying one more cut in 2026). Chair Powell is likely to emphasize lingering service‑sector inflation and the lack of fresh data because of the government shutdown. Traders should be prepared for volatility and potential draw‑downs if Powell signals caution about further easing. Conversely, a dovish press conference could ignite another risk‑on squeeze, especially across altcoins.
🔍 Macro Pulse: Liquidity, Policy & the Bigger Picture
The liquidity regime is in transition. Quantitative tightening formally ended on December 1st (the Fed will stop shrinking its balance sheet this month). Combined with an expected rate cut, the liquidity impulse is turning positive for the first time in over two years. Historically, that shift has preceded rotation from large‑cap crypto into higher‑beta assets. The Fed could deliver only a hawkish cut and signal a long pause, leaving liquidity conditions tighter than market participants hope.
The coming week will determine whether December becomes a reset month or an accelerant for the next cycle. If the Fed signals additional cuts are likely, expect further inflows into crypto, with BTC and ETH consolidating above $90k and $3k and selective altcoins breaking out. If Powell hints at a prolonged pause or expresses concern about sticky inflation, the rally could stall and another liquidity trap may develop.
👓 Institutional Lens
Positioning: After November’s deleveraging, many hedge funds and crypto‑native funds remain underweight. The early‑December rally forced some participation, but the FOMC decision will dictate whether institutions increase exposure or fade the move.
Flows: ETF data show modest inflows into BTC vehicles in early December, but ETH ETFs saw outflows as investors reallocated after the autumn run‑up. BitMine’s purchase highlights continued accumulation by treasuries. If the Fed leans dovish, we could see a return of retail flows into high‑beta altcoins.
Narratives: The market’s narrative mix is shifting. Earlier focus on layer‑2 scaling and zero‑knowledge proofs is giving way to macro themes such as rate cuts, liquidity and currency devaluation. Watch for renewed interest in real‑world asset (RWA) tokenization and synthetic dollars if the Fed cuts; hawkish messaging may refocus attention on defensive narratives such as BTC’s scarcity and ETH staking yields.
🌍 The Bigger Picture
December’s first week demonstrated that crypto remains tethered to macro currents. The early flush and subsequent rebound highlight the importance of staying nimble and adhering to risk discipline. With quantitative tightening ending and a potential rate cut on the horizon, crypto may be poised for a new bull phase but only if inflation cooperates and the Fed signals more than a one‑off cut.
As we head into the FOMC meeting, keep exposure sizes modest, respect stop‑losses, and be ready to act on Powell’s tone. Whether the outcome is a hawkish cut or a dovish pivot, the reaction will set the tone for the rest of December and shape the crypto landscape for 2026.