The cryptocurrency market has started December on a sour note, with major assets such as Bitcoin, XRP, and Solana facing significant declines. The total market capitalization has fallen by 5.7%, bringing it down to $3.01 trillion, following a disappointing November that failed to deliver the anticipated “Moonvember” gains.
As of now, Bitcoin has experienced a steep drop of 5.9%, trading around $85,786, marking a substantial 31.7% decline from its all-time high of $126,080 in October. Other notable cryptocurrencies have also taken a hit, with Ethereum decreasing by 5.3%. XRP plummeted by 6.8%, while Solana and Dogecoin saw declines of 7% and 8.1%, respectively.
Liquidations in the market have surged, with approximately $638 million wiped out over the last 24 hours, according to data from CoinGlass. This figure includes about $568 million in long positions, which are bets on rising prices. The most affected assets include Bitcoin and Ethereum, with liquidations totaling $188.8 million and $158.7 million respectively.
The recent downturn in Bitcoin and the broader market has been linked to rising expectations regarding the Bank of Japan”s potential interest rate hike in mid-December. This anticipated tightening, marking Japan”s first rate hike since January, has raised concerns about unwinding yen-funded carry trades, leading to increased risk-off sentiment among investors. Arthur Hayes, co-founder of BitMEX, noted on X that the expected rate hike could be a contributing factor to Bitcoin“s decline.
In light of these developments, veteran trader Peter Brandt has suggested that Bitcoin could revisit sub-$40,000 levels. His analysis points to a macro downtrend, indicating that support may be found in the $45,000 to $70,000 range. The market”s recovery will depend on the emergence of strong catalysts in the near future to reverse the current bearish trend.
