Cryptocurrency Market Performance

Currently, the total market capitalization of cryptocurrencies is $2.95 trillion, with BTC accounting for 59.1%, or $1.74 trillion. The market cap of stablecoins is $31.84 billion, which has decreased by 0.28% in the last 7 days, indicating a weekly negative growth for stablecoins, with USDT making up 60.54%.

Among the top 200 projects on CoinMarketCap, most have declined while a few have risen. Specifically, BTC has dropped 1.4% over the past week, ETH has decreased by 1.89%, SOL has fallen by 2.84%, while NIGHT has increased by 22.03%, and H has risen by 28.88%.

This week, the net outflow from U.S. Bitcoin spot ETFs was $589 million; the net outflow from U.S. Ethereum spot ETFs was $80.3 million.

Market Forecast (December 29 - January 2):

Currently, the RSI index is at 51.46 (neutral range), and the Fear and Greed Index is at 22 (lower than last week, indicating general fear). The Altcoin Season Index is at 37 (neutral, unchanged from last week).

The core driving force behind the recent market trend is the leveraged liquidation under thin liquidity:

Event-driven: Around Christmas Eve (December 24), the market experienced a flash crash without significant negative news, with Bitcoin dropping $2,300 in 45 minutes, triggering over $66 million in long liquidations. This reveals that during holiday periods, the market lacks depth and is prone to severe fluctuations due to large orders or leveraged liquidations.

Liquidity: As previously mentioned, spot Bitcoin and Ethereum ETFs have seen continuous net outflows before the holidays, weakening institutional buying support and making the market more fragile.

Technical: The three major assets are currently oscillating above key support areas. Whether BTC can hold above $85,000, whether ETH can stabilize around $2,900, and whether SOL can maintain above $120 are crucial for determining if the market can stop its decline.

BTC core range: $83,000-89,000

ETH core range: $2,750-3,050

SOL core range: $115-130

As shown in the chart, the current long-term holder's realized profit ratio (SOPR) for Bitcoin is 1.53. In a typical bull market environment, this value is at a low range; if in a bear market, it is at a neutral level, far from the most panicked bear market bottom.

The macro landscape of this market has fundamentally changed: cryptocurrencies are transitioning from being restricted by many countries globally to gaining legislative recognition in mainstream markets like the U.S.; the market's dominance has gradually shifted from early miner groups to large institutions on Wall Street.

In the face of this new market structure, we should neither simply apply the past "four-year cycle" theory nor blindly continue the bull market mindset. Looking ahead to 2026, the market will intertwine dangers and opportunities:

The danger lies in the fact that, from a historical cycle perspective, the traditional bear market time window has already opened.

The opportunity lies in the high probability that the Federal Reserve will enter a rate-cutting cycle, with global liquidity expected to continue to flow in; at the same time, asset management institutions and listed companies are still continuously increasing their holdings, providing solid structural buying support for the market.

Therefore, even if the market enters an adjustment, its duration may be shortened, and the bottom will receive strong support. Based on this, we boldly predict that the bear market bottom price range for this cycle will be between $50,000 and $60,000.

Understanding Now

Review of Major Events of the Week

1. On December 21, regarding the "50 million USDT phishing attack," the Ethereum Community Foundation posted on X platform, calling for an end to the practice of truncating addresses with ellipses (e.g., 0xbaf4b1aF…B6495F8b5). Address information needs to be displayed in full, as hiding parts of the address can create unnecessary risks. Currently, some UI options provided by certain wallets and block explorers also have security issues, which can actually be resolved;

2. On December 24, according to market data, U.S. stocks continued to rise, with the S&P 500 index approaching 6,900 points, just under 10 points away from the historical closing record. Additionally, the Dow Jones rose 0.18% during the day, and the Nasdaq increased by 0.27%;

3. On December 24, approximately $23.6 billion worth of Bitcoin options will expire this Friday, marking the largest options expiration day in Bitcoin's history. Analysts point out that this expiration day is significantly large and generally bullish. The maximum pain point (the price level where option buyers suffer the most losses and sellers gain the most) is $96,000, which will reinforce the upward price trend;

4. On December 24, according to Cointelegraph, Aave founder Stani Kulechov has recently faced scrutiny for spending over $10 million to buy AAVE tokens, with some in the crypto community believing this move is to enhance his voting power in a key governance proposal;

5. On December 25, USD1's market cap surpassed $3 billion, reaching $3.011 billion, with a 24-hour growth of 7.68%. Previously, Binance launched a USD1 savings product with an annualized yield of up to 20%;

6. On December 26, mentions related to blockchain in filings with the U.S. Securities and Exchange Commission (SEC) surged throughout 2025, reaching about 8,000 in August and remaining high in November. Bitcoin-related mentions dominated this growth, accounting for the largest share of filing activity, with filings and amendments for Bitcoin spot ETFs increasing, and traditional asset management companies continuing to expand their cryptocurrency products in 2025.

Macroeconomics

1. On December 24, the number of initial jobless claims in the U.S. for the week ending December 20 was 214,000, with an expectation of 224,000;

2. On December 23, according to CME's "FedWatch" data, after the release of today's U.S. macroeconomic data, the probability of the Federal Reserve cutting rates by 25 basis points in January has dropped to 13.3%, while the probability of maintaining rates unchanged is 86.7%. Last week, the probability of a rate cut in January had risen to 31%. The inflation-adjusted annualized quarterly growth rate of the U.S. GDP for the third quarter was recorded at 4.3%, with the U.S. GDP growth rate soaring, marking the strongest growth since the fourth quarter of 2023. The probability of the Federal Reserve maintaining rates unchanged until March next year is 54.4%, with a cumulative probability of a 25 basis point rate cut at 40.7% and a cumulative probability of a 50 basis point rate cut at 4.9%.

ETF

According to statistics, from December 22 to 26, the net outflow from U.S. Bitcoin spot ETFs was $589 million; as of December 26, GBTC (Grayscale) had a total outflow of $25.14 billion, currently holding $14.504 billion, while IBIT (BlackRock) currently holds $67.652 billion. The total market cap of U.S. Bitcoin spot ETFs is $116.673 billion.

The net outflow from U.S. Ethereum spot ETFs was $80.3 million.

Envisioning the Future

Project Progress

1. The blockchain game ChronoForge tweeted that it will cease operations on December 30, citing "many obstacles," including a lack of funds, which has forced the founder to self-fund development since July and lay off 80% of the staff. "After discussions with the Rift Foundation, we believe we cannot sustain the operation of the game or the token, and ChronoForge will stop services on December 30, 2025;"

2. WLFI announced that the zero-fee promotion for BNB ecosystem USD1 has been extended to December 31, allowing users to transfer, withdraw, and cross-chain USDC and USD1 without fees on CEX, wallets, and cross-chain bridges;

3. BYEX is about to cease operations, and users must withdraw their assets before December 31;

4. Rabby Wallet announced that the backend API for Rabby Desktop will stop services on December 31. This change will not affect user assets, which remain completely secure and can still be accessed through the Rabby plugin;

5. StarkWare has launched a $1 million OPCAT research fund to finance research on the pros and cons of activating OPCAT on Bitcoin. The submission deadline for research proposals is January 1, 2025.

Important Events

1. The fourth round of compensation for FTX is expected to start in January 2026, with the qualification confirmation deadline possibly in December, but the specific time needs to wait for the official announcement;

2. The Turkmenistan cryptocurrency asset regulation bill will take effect on January 1, which will help attract investment and promote digitization. The bill covers the regulatory framework for creating, storing, issuing, using, and circulating virtual assets within Turkmenistan and clarifies their legal and economic status;

3. The Basel Committee plans to implement a bank cryptocurrency asset risk disclosure framework on January 1, 2026, which includes a set of standardized public forms and templates covering bank cryptocurrency asset risks. These disclosures aim to improve information availability and support market discipline;

4. Switzerland's tax information automatic exchange bill covering cryptocurrency assets is expected to take effect on January 1, 2026, meaning financial institutions will be required to collect and report customer information related to cryptocurrency assets;

5. The UK government will implement new cryptocurrency tax regulations starting in January 2026, cracking down on tax evasion. According to the guidelines, cryptocurrency exchanges operating in the UK must begin collecting detailed transaction records and complete information for all UK customers. HMRC will use the collected data to cross-check users' tax returns to ensure tax compliance, with violators facing penalties. Additionally, the UK's new guidelines align with the OECD's cryptocurrency asset reporting framework to enhance transparency in the digital asset market;

6. The UK tax authority requires cryptocurrency companies to report every customer transaction starting in 2026, with non-compliance or inaccurate reporting potentially resulting in fines of up to £300 ($398.4) per user;

7. On January 3, the U.S. will announce the number of initial jobless claims for the week ending December 27 (in thousands).

Token Unlocking

1. Jupiter (JUP) will unlock 53.47 million tokens on December 28, valued at approximately $10.7 million, accounting for 1.73% of the circulating supply;

2. Kamino (KMNO) will unlock 230 million tokens on December 30, valued at approximately $11.69 million, accounting for 5.35% of the circulating supply;

3. EigenCloud (EIGEN) will unlock 36.82 million tokens on January 1, valued at approximately $14.31 million, accounting for 9.74% of the circulating supply;

4. Ethena (ENA) will unlock 40.63 million tokens on January 2, valued at approximately $8.64 million, accounting for 0.56% of the circulating supply;

About Us

Hotcoin Research, as the core research institution of Hotcoin Exchange, is dedicated to transforming professional analysis into your practical tools. Through our "Weekly Insights" and "In-depth Research Reports," we analyze market trends for you; leveraging our exclusive column "Hotcoin Selection" (AI + expert dual screening), we help you identify potential assets and reduce trial-and-error costs. Each week, our researchers also engage with you through live broadcasts to interpret hot topics and predict trends. We believe that warm companionship and professional guidance can help more investors navigate cycles and seize the value opportunities of Web3.

Risk Warning

The cryptocurrency market is highly volatile, and investment carries risks. We strongly advise investors to invest only after fully understanding these risks and within a strict risk management framework to ensure the safety of their funds.