The latest downturn in the crypto market is raising new alarm in the mindset of investors and it seems to be leading to a definite move towards risk-off behavior. 

With volatility soaring and liquidity constrained, traders are exiting aggressive positions and shifting to more secure allocations. This is gradually taking a new trend as the year ends approaches.

DBS Chief Economist Timor Baig believes that the ongoing crypto selloff is not merely yet another typical correction and it might be the best sign that the market is gearing up towards a more defensive backdrop. His remarks indicate that institutional traders are reevaluating their exposure and decreasing risk on big digital assets.

This risk off position may persist as we enter the new year as macro uncertainty increases and sentiment declines. Meanwhile it remains to be seen whether this is a cooling off period or the beginning of a wider reset as international markets respond in the next few weeks.

In the meantime, the message is straightforward: the crypto market is blinking red lights, and investors are keen to observe when the next momentum would take place.