Crypto Market Hits New Lows but Steers Clear of Sharp Volatility

Crypto Market Update: Sideways Action Amid Mixed Signals

The crypto market continues to test investor patience, oscillating between gains and losses without clear direction. Yesterday, total market capitalization briefly surged to $3 trillion before pulling back to $2.85 trillion. As of Friday morning, it steadies near $2.95 trillion—a level it has hovered around since early this week.

Bitcoin’s recent price action mirrors a micro-drama: it rallied toward $90K on Thursday, only to slip below local lows by day’s end, hitting $84K—its lowest in nearly five weeks. By Friday morning, BTC recouped some losses, trading around $87K, a range it has maintained over the past four days.

While Bitcoin’s buyers have been preventing sharp declines, several top altcoins, including Ethereum, XRP, and Solana, show gradual downward pressure—likely due to quiet sell-offs by large holders over recent months. Zcash remains volatile, often spiking on signs of a broader market reversal before sharply retreating.

Market Sentiment & Risks

Derive.xyz highlights options market activity hedging against BTC falling below $85K, signaling investor caution amid expected year-end volatility. Liquidity challenges and erratic ETF inflows ahead of the holidays add to market uncertainty. Bitcoin’s growing correlation with Nasdaq reflects the influence of institutional investors and concerns over AI sector ROI in the US.

BitcoinForCorporations warns of a potential $15 billion outflow if MSCI excludes certain DAT companies from its indices—eighteen firms face this risk.

Despite volatility, Bitwise reports that Bitcoin’s 2025 price swings have been less than those of Nvidia shares, helped by the rise of spot ETFs and traditional investment vehicles, which have fundamentally lowered risk.

Ethereum Network Concerns

The Ethereum Foundation flags that rising users and increased gas limits have “inflated” the blockchain, stressing network nodes and prompting proposals for simplification. Ethereum co-founder Vitalik Buterin emphasizes that the ecosystem’s complexity hampers widespread adoption.

Sources: Fxstreet