Market Movement:

  • Bitcoin’s hashrate declined 4% in December, signaling potential bullish momentum, with historical data showing positive 90-day returns after similar declines

Key Events:

  • Top five crypto airdrops in 2025 paid users over $4.5 billion at their peaks, led by new layer-1 tokens like Story Protocol and Berachain

Trading Signals:

  • Strategy’s USD reserve fund increased to $2.19 billion, with a pause in Bitcoin purchases and an addition of $748 million in cash near Christmas

Narrative Shifts:

  • BitMine’s accumulation of over 4 million ETH amid market volatility suggests a strategic shift toward long-term treasury growth despite broader headwinds

Risk Alerts:

  • Bitcoin’s 4% hashrate decline in December signals miner capitulation, with potential for market bottoming but increased short-term volatility risk
  • Market volatility persists with Ethereum facing broader headwinds, and the sector remains sensitive to regulatory and macroeconomic uncertainties

Opportunities:

  • Ethereum’s treasury surpassing 4 million ETH and BitMine’s accumulation indicate potential upside for ETH-related assets and corporate holdings
  • Erebor’s progress toward launching a regulated digital bank presents growth potential in crypto-adjacent financial services
  • The historical trend of Bitcoin’s positive returns following hashrate declines suggests a bullish outlook for the sector in the coming months

Flows & Positioning

$952 Million Exodus from U.S. Crypto Funds Amid Regulatory Uncertainty

U.S. digital asset investment products experienced significant outflows totaling $952 million, primarily driven by delays in the Clarity Act and concerns over whale selling. The majority of these outflows, approximately $990 million, originated from U.S.-based products, with Ethereum and Bitcoin leading the losses at $555 million and $460 million, respectively. This marks the first weekly outflow in a month, highlighting growing investor anxiety regarding regulatory clarity in the U.S. market. In contrast, altcoins such as Solana and XRP saw inflows of $48.5 million and $62.9 million, respectively, indicating selective demand amidst broader market panic.

The overall trend suggests that while major cryptocurrencies face challenges, certain altcoins are attracting investor interest, potentially due to their perceived resilience or unique value propositions.

Strategy Inc. Pauses Bitcoin Purchases, Boosts Cash Reserves to $2.19 Billion

Strategy Inc. has paused its bitcoin acquisition strategy, opting instead to bolster its cash reserves by $748 million, bringing the total to $2.19 billion. This increase was achieved through the sale of approximately 4.54 million shares of its Class A common stock. The company continues to hold 671,268 BTC, maintaining its position as the largest corporate holder of bitcoin, with an aggregate purchase price of roughly $50.33 billion. This strategic shift reflects a cautious approach amid current market volatility, as the company focuses on liquidity rather than immediate accumulation of digital assets.

The absence of new bitcoin purchases suggests a tactical pause rather than a long-term change in strategy, potentially positioning the firm for future opportunities as market conditions evolve.

Bitcoin Price Struggles Near $90,000 as Whales Unload Significant Holdings

Bitcoin's price briefly crossed the $90,000 mark but has since retreated to around $88,000, reflecting a pattern of volatility as traders react to market conditions. The price movements are accompanied by a notable increase in bitcoin futures open interest, which has risen toward $60 billion, indicating fresh leveraged positions entering the market. However, the overall market sentiment remains cautious, with significant whale selling contributing to the price's inability to maintain higher levels. Whale activity has intensified, with wallets holding between 10,000 and 100,000 BTC collectively offloading 36,500 BTC, valued at approximately $3.37 billion, since the beginning of December.

This distribution from large holders often precedes price declines, raising concerns about potential further downside risks as the market navigates through these turbulent conditions.

Ethereum Accumulation by BitMine Amid Market Volatility

BitMine Immersion Technologies has significantly increased its Ethereum holdings, surpassing 4 million ETH, valued at approximately $12.1 billion. This aggressive accumulation comes despite ongoing market volatility, with the company acquiring 98,852 ETH recently. BitMine's strategy aims to capture a 5% stake of the total Ethereum supply, which currently stands at about 3.37% following this latest purchase. The company's rapid accumulation reflects a broader trend of institutional interest in Ethereum, particularly as the asset faces regulatory scrutiny.

Analysts suggest that BitMine's strategy positions it well to benefit from future developments in Ethereum's staking and decentralized finance ecosystems, potentially enhancing its value proposition as market conditions stabilize.

Corporate & Capital Markets

Alphabet Agrees to Acquire Intersect Power for $4.75bn

Alphabet has agreed to buy Intersect Power for $4.75bn.

Coinbase to Acquire The Clearing Company to Expand Prediction Markets

Coinbase has agreed to acquire The Clearing Company as it plans to scale prediction markets and advance its ambition of becoming an “Everything Exchange.” The deal follows Coinbase’s recent rollout of prediction markets trading for users and is expected to close in January.

Macro & Policy

Erebor Bank Receives Regulatory Green Light for Digital Asset Activities

Erebor, a digital bank co-founded by Palmer Luckey and backed by Peter Thiel, raised $350 million at a valuation of $4.35 billion. This funding coincides with the Office of the Comptroller of the Currency (OCC) granting preliminary conditional approval for Erebor's de novo national bank charter on October 15, 2025. The OCC's decision indicates a willingness to allow banks to engage in digital asset activities under safe conditions, reflecting a shift in regulatory attitudes towards crypto-adjacent finance. Additionally, the Federal Deposit Insurance Corporation (FDIC) approved Erebor's deposit insurance application in December 2025, contingent on meeting certain capital requirements.

Specifically, Erebor must maintain at least $276 million in initial paid-in capital and a tier 1 leverage ratio of no less than 12% for the first three years of operation. This regulatory framework aims to ensure that banks engaging with digital assets do so in a financially sound manner, addressing concerns raised by the 2023 collapse of Silicon Valley Bank.

Ghana Legalizes Cryptocurrency Trading Under New Regulatory Framework

Ghana has officially legalized cryptocurrency trading with the passage of the Virtual Asset Service Providers (VASP) Bill on December 19, 2025. This law establishes a regulatory framework that allows the Bank of Ghana to license and supervise companies operating in the digital asset space, marking a significant shift towards formal oversight of the sector. Bank of Ghana Governor Johnson Asiama emphasized that the legislation aims to manage risks such as fraud and money laundering while enhancing consumer protection. The new law reflects the reality of widespread crypto usage in Ghana, where approximately 17% of the population, or around three million adults, already engage in digital currency transactions.

By formalizing the sector, the Ghanaian government seeks to provide a safer environment for users and businesses while maintaining regulatory control over the burgeoning market.

JPMorgan Explores Bitcoin Trading Services Amid Regulatory Shifts

JPMorgan Chase is considering the introduction of bitcoin trading services for institutional clients, as reported by Bloomberg. The discussions are still in preliminary stages, with no final decision made. The bank is evaluating potential offerings, including spot bitcoin trading and derivatives, contingent on client demand and internal risk assessments. This move reflects a growing interest among institutional investors in accessing digital asset markets through established financial institutions.

JPMorgan's interest aligns with a broader regulatory shift in the U.S., as market participants anticipate progress on federal digital asset regulations. Analysts at the bank have noted that bitcoin appears undervalued compared to gold, suggesting potential upside in the market, which could further drive institutional interest in trading digital assets.

Bitcoin Strategy Increases USD Reserve Fund to $2.19 Billion

In a bid to address concerns over insolvency, Bitcoin Strategy has increased its USD reserve fund to $2.19 billion. This substantial reserve aims to bolster confidence among investors and mitigate fears surrounding the financial stability of the fund. The increase in reserves comes amid a broader context of market volatility and investor caution, particularly following significant sell-offs in the crypto market.

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