Market Movement:

  • Bitcoin dipped below $90,000 this week, erasing gains from the $94,000–$95,000 zone, with Bitcoin holding steady around $92,000 after recent sell-offs.

Key Events:

  • Spot Bitcoin ETF outflows reached $194.6 million on December 5, the highest in two weeks, with BlackRock’s IBIT fund accounting for $113 million of the outflows.
  • Bitcoin experienced a liquidation of nearly $500 million across exchanges in 24 hours, including approximately $420 million in long positions, with over 140,000 traders liquidated.

Trading Signals:

  • US ETF inflows fell to just $59 million on December 3, indicating waning institutional demand amid ETF outflows totaling over $2.8 billion in six weeks.
  • The total crypto market capitalization increased by 7% since November 23, reaching approximately $3.2 trillion, despite recent volatility.
  • The $WET presale was sniped by a single actor using over 1,000 wallets, claiming 70% of the allocation, highlighting bot activity and potential manipulation.

Narrative Shifts:

  • DeFi ecosystem peaked at $237 billion TLV in Q3 2025, then contracted by $55 billion to $123 billion by late November, yet wallet participation increased to over 14.2 million.
  • Institutional accumulation via large ETH purchases and the rise of AI-powered DeFi systems like Theoriq’s AlphaVault suggest a shift toward more sophisticated, passive investment strategies.
  • The market is transitioning from exuberance to cautious optimism, with inflows resuming after a 1.5% daily dip and a 5.5% rise in total market cap since last week.

Risk Alerts:

  • High volatility persists with nearly $500 million liquidated in 24 hours, and ETF outflows reaching $194.6 million, signaling uncertain investor sentiment.
  • Regulatory risks are implied by bot activity and manipulative tactics in presale events, such as the $WET sniper incident involving over 1,000 wallets.
  • The disconnect between official September PCE data (2.8%) and real-time estimates (2.13%) highlights macroeconomic uncertainty and potential mispricing risk.

Opportunities:

  • The rise of innovative tokens like PEPENODE, with a 570% APY staking reward and a presale raising $2.27 million, presents a promising entry point for high-yield investments.
  • The expanding DeFi participation (over 14.2 million wallets) and sector rotation toward AI-driven systems suggest potential for growth in passive DeFi and AI-enabled investment platforms.

Flows & Positioning

Bitcoin ETFs Experience $194.6M Outflows Amid Market Volatility

On December 5, Bitcoin ETFs faced significant outflows totaling $194.6 million, marking the highest outflow in two weeks. This trend follows a period of positive inflows earlier in the week, indicating a reversal in investor sentiment, likely influenced by macroeconomic factors such as potential interest rate hikes in Japan and unwinding of basis trades. BlackRock's iShares Bitcoin Trust was notably impacted, accounting for $113 million of the outflows. This continued a troubling trend for the ETF, which has seen over $2.8 billion in outflows over the past six weeks, raising concerns about institutional appetite for Bitcoin amid ongoing market uncertainty.

Bitcoin Price Dips Below $90K as Liquidations Surge

Bitcoin's price fell below $90,000 this week, driven by a wave of forced liquidations that wiped out nearly $500 million across exchanges. This included approximately $420 million in long positions, with over 140,000 traders liquidated in just 24 hours. The price drop erased previous gains and marked the second significant breakdown for Bitcoin this month. Analysts are closely monitoring the $84,000 support level, which, if breached, could signal a deeper bearish trend.

Currently, Bitcoin is trading around $89,215, with market sentiment remaining fragile as traders react to macroeconomic pressures and ETF outflows.

Institutional Activity and ETF Sentiment Shift

BlackRock's iShares Bitcoin Trust has now recorded its longest outflow streak since its launch, with a total of $2.7 billion withdrawn over five weeks. This shift in sentiment follows a broader market liquidation that erased over $1 trillion in crypto value, prompting concerns about the sustainability of institutional investments in Bitcoin. Despite these outflows, BlackRock's business development director downplayed the significance, suggesting that such fluctuations are typical in liquid markets. However, the ongoing trend raises questions about future institutional interest, particularly as Bitcoin's price struggles to maintain momentum above key resistance levels.

Market Implications and Future Outlook

The recent outflows from Bitcoin ETFs and the price decline below $90,000 highlight a critical juncture for the cryptocurrency market. With significant liquidation events and macroeconomic uncertainties, traders are adopting a cautious approach, focusing on key support levels to gauge future price movements. As the market awaits further developments, including potential regulatory changes and macroeconomic signals, the outlook for Bitcoin remains uncertain. Investors are advised to monitor liquidity trends and institutional flows closely, as these factors will likely influence market direction in the coming weeks.

Corporate & Capital Markets

Paribu Acquires Majority Stake in CoinMENA Valued at $240 Million

Paribu has bought a majority stake in Dubai- and Bahrain-licensed CoinMENA in a deal valuing the exchange at up to $240 million.

AlphaTON Plans $420.69 Million Fundraising Program

AlphaTON exits baby-shelf limits and plans a meme-sized $420.69 million fundraising program despite being a nano-cap with a steep stock decline.

Bitcoin Miners Face Record Margin Pressure Amid Market Cycle

Bitcoin miners face record margin pressure as proxy stocks sink, Kalshi lands $1 billion funding, and Ether derivatives volumes overtake Bitcoin on CME.

On-Chain & Network

Ethereum Sees 25% Drop in Validation Participation Post-Fusaka Upgrade

Following the Fusaka upgrade, Ethereum experienced a significant 25% decline in its voting participation, which is critical for network validation. This drop in validator engagement coincided with a bug identified in the Prysm consensus client, raising concerns about the network's stability. Currently, Ethereum is reported to be just 9% away from losing finality, which could severely impact transaction confirmations and overall network reliability.

Macro & Policy

IMF Warns Stablecoins May Undermine Central Bank Control

The International Monetary Fund (IMF) has expressed concerns that the growing use of stablecoins could weaken the control that central banks have over monetary policy. This warning highlights the potential risks associated with the rapid expansion of the stablecoin sector, which is currently valued at approximately $288 billion. The IMF's stance suggests that regulatory frameworks may need to be developed to mitigate these risks and ensure that central banks can maintain effective oversight of the financial system.

CLARITY Act Advances in Congress Amid Regulatory Uncertainty

The CLARITY Act, a significant piece of legislation aimed at establishing a federal framework for digital assets, successfully passed the House in July 2023 with bipartisan support. However, its future in the Senate remains uncertain as unresolved issues, including the treatment of stablecoin yield and decentralized finance, continue to hinder progress. The Act's passage is crucial for providing clarity to the crypto market, but it may face delays due to political contention as it approaches a potential Senate vote in 2026.

MSCI Faces Pressure to Reassess Bitcoin Exclusion Policy

Strive CEO Matt Cole has called on MSCI to reconsider its current policy that excludes companies holding Bitcoin from its indices. Cole argues that this approach is "unworkable" and advocates for allowing the market to determine the inclusion of Bitcoin-holding firms in passive investments. This push reflects a growing sentiment among market participants for more inclusive policies that recognize the legitimacy of Bitcoin as an asset class.

Fed's Preferred Inflation Measure Shows 2.8% Increase

The Federal Reserve's favored inflation indicator, the Personal Consumption Expenditures (PCE) index, reported a 2.8% increase in September 2023 compared to the previous year. This data, which reflects consumer spending trends, is critical as the Fed deliberates on potential interest rate adjustments. The slight underperformance relative to expectations may influence the Fed's decision-making process regarding future monetary policy.

Tether's Solvency Concerns Addressed by CoinShares

CoinShares has countered recent claims regarding Tether's solvency, asserting that the company maintains a substantial surplus of several billion dollars. This statement aims to alleviate fears surrounding Tether's financial stability, which have been fueled by criticisms from various industry figures. The reassurance from CoinShares may help stabilize market confidence in Tether, a major player in the stablecoin sector.

Security & Incidents

British Hacker Linked to $243M Genesis Theft Likely Detained in Dubai

A suspected British hacker linked to the theft of 4,064 Bitcoin, worth about $243 million at the time, may have been detained in Dubai. The theft occurred on August 19, 2024, from a single Genesis creditor who accessed assets through Gemini. ZachXBT reported that roughly $18.58 million in digital assets are now held in a single Ethereum wallet connected to the suspect, identified as Danish Zulfiqar. Authorities have not confirmed any arrest or asset seizure related to the case, and local media have not verified these claims.

The investigation revealed that the attackers used social engineering tactics, posing as Google support staff to gain access to the victim's account.

U.S. Prosecutors Seek 12-Year Sentence for Do Kwon in $40 Billion Collapse

U.S. prosecutors are pushing for a 12-year prison sentence for Do Kwon due to his involvement in the $40 billion collapse of Terra. This case highlights significant regulatory scrutiny in the cryptocurrency space.

Mass Botting Incident in $WET Presale Captured 70% Allocation

A chaotic token launch on Solana saw a single actor, operating under the alias “Ramarxyz,” use over 1,000 wallets to claim roughly 70% of the $WET public presale allocation. The presale sold out in just two seconds, overwhelming most retail participants. HumidiFi confirmed that a large bot farm was responsible for the exploit, with at least 1,100 of the 1,530 participating addresses controlled by the same actor. Following the incident, HumidiFi canceled all suspected bot allocations.

International Operation Disrupts Crypto Fraud Network Laundering Over $815 Million

Coordinated raids have led to arrests and multimillion-dollar seizures, disrupting a crypto fraud network that laundered more than $815 million. This operation underscores the ongoing efforts by law enforcement to tackle large-scale crypto fraud.

Keep yourself in the know

Open-source crypto market intelligence delivered everyday.