Bitcoin (BTC) and the broader cryptocurrency market have started the week after registering a sharp drop over the weekend, thanks to a leverage flush. The flagship cryptocurrency fell to a low of $87,861 on Sunday, spending the weekend pinned below $90,000 before rebounding to reclaim $90,000 and settle at $91,691.
However, it registered another sharp drop to $89,397 before rebounding and moving to its current level. BTC is up over 3% in the past 24 hours, trading around $92,000.
Despite the strong start to the week, 10x Research has issued a warning about volatility brewing under the surface. The firm noted in its latest report that options traders are buying volatility, downside skew was returning, funding rates had softened, and futures open interest was diverging.
Coinbase Makes India Return After Two-Year Hiatus
Coinbase has returned to India after a two-year break. The exchange reopened registrations, returning to the world’s second-largest internet market, and plans to introduce fiat-currency integration in 2026. The exchange is currently offering only crypto-to-crypto trading while working towards restoring full services. Restoration of its full suite of offerings will allow Indian users to deposit fiat and purchase crypto directly on the platform.
Coinbase first began its India operations in 2022, but was quickly forced to suspend operations after the National Payments Corporation refused the use of its Unified Payments Interface (UPI). The exchange wound up its operations in India by September 2023, urging customers to transfer their holdings and funds elsewhere. According to Coinbase’s Asia-Pacific regional director, John O’Loghlen, the decision to completely exit the market was a significant commercial risk. Speaking at the India Blockchain Week, he explained that an exit gave Coinbase a clean regulatory slate, allowing it to engage with India’s Financial Intelligence Unit in 2024 and secure approval for registration and a limited launch in October before expanding to the general public.
Coinbase is now the latest platform to receive Financial Intelligence Unit authorization, following Binance, KuCoin, and Bybit.
Strategy Copycats Hemorrhaging Money
Digital asset treasury companies that copied Michael Saylor’s Strategy are struggling as median stock prices plunged 43% year-to-date. Over 100 publicly-traded companies reinvented themselves as Bitcoin and cryptocurrency treasury companies, borrowing billions to buy digital tokens. The strategy paid off initially as stock prices surged past the value of the underlying assets. However, the recent market downturn has hit the companies with a sobering reality check.
SharpLink Gaming is one example, pivoting from gaming operations to announce massive token purchases as it reimagined itself as a digital asset treasury. The company’s stock skyrocketed an astonishing 2,600% before plummeting 86%. According to Bloomberg data, the median share price of 138 US and Canadian digital asset treasury companies has fallen 43% year-to-date. In comparison, the S&P 500 gained 6% and the Nasdaq 100 rose 10%.
Strategy shares have also taken a substantial hit, dropping 60% from their July highs. However, the company’s share price has risen 1,200% since it began buying Bitcoin. B. Riley Securities analyst Fedor Shabalin stated,
“Investors took a look and understood that there’s not much yield from these holdings, rather than just sitting on this pile of money.”
Investor Focus On FOMC Meeting
Market experts, investors, and economists will be closely watching the Fed’s final monetary policy meeting of the year, scheduled for December 9 and 10. The meeting will examine inflation trends, employment data, macroeconomic conditions, and potential interest rate changes. Markets have assigned an 87% chance that the FOMC will cut interest rates by 25 basis points. However, some have urged caution, highlighting conflicting inflation data and strong GDP growth.
The meeting will also mark the end of quantitative tightening, concluding a $95 billion per month reduction in Treasury and mortgage-backed securities holdings. The end of quantitative tightening could see liquidity returning to the market. Crypto market experts believe a 25 bps rate cut could boost the market, pushing BTC back above $100,000, and setting ETH and SOL on an upward trajectory as well.
Bitcoin (BTC) Price Analysis
Bitcoin (BTC) briefly dipped below $88,000 on Sunday, with analysts attributing the drop to FOMC jitters and another round of leverage flushes. However, it quickly rebounded to reclaim $91,000 and start the week in positive territory. According to crypto trader Daan Crypto Trades, Bitcoin is trading around a key level that could determine if its uptrend continues or it slips into a bearish market that could drag it below $80,000. The trader noted in a post on X,
“BTC is still holding on to that .382 area from the entire bull market so far. I think this is a key area for the Bulls to defend. It’s also pretty much the last major support before testing the April lows again, which would break this high-timeframe market structure. So watch this price region closely in the week(s) ahead into the new year.”
Analysts blamed the weekend dip on another leverage flush, describing it as a typical low-liquidity weekend manipulation to flush long and shorts. Moving forward, the market is focused on the Federal Open Market Committee (FOMC) meeting, with many expecting a 0.25 bps rate cut. The crypto market has cooled since October’s liquidation event, with Fed Chair Jerome Powell emphasizing a data-dependent approach rather than a more predictable easing cycle. 10x Research’s Markus Thielen expects a similar tone from this week’s meeting, keeping pressure on risk assets. Thielen believes market participation will remain muted as trading volumes thin and ETF inflows dwindle.
“Bulls will point to the Treasury General Account rebuild, the end of Quantitative Tightening, and looming rate cuts as a liquidity windfall for Bitcoin.”
However, a key on-chain indicator called the “Liveliness Index” has started climbing, even though BTC remained subdued last week. Analysts believe the divergence indicates renewed underlying demand, a sign that long-term holders could be re-entering the market.
BTC registered a sharp drop on Monday (December 1), dropping to a low of $83,800 before settling at $86,282 as it started the month in the red. Despite the overwhelming selling pressure, it recovered on Monday, rising nearly 6% to reclaim $90,000 and settle at $91,308. Buyers retained control on Tuesday as BTC rose over 2% to $93,453. However, it lost momentum on Wednesday, dropping 1.46% to $92,093.
Source: TradingView
Selling pressure intensified on Thursday as BTC fell almost 3%, slipping below $90,000 to $89,345. The price registered a marginal decline on Saturday but faced volatility on Sunday, rising to a high of $91,779, dropping to a low of $87,733, before settling at $90,402. The flagship cryptocurrency is up over 1% during the ongoing session, trading around $91,946. The MACD and RSI show building bullish sentiment, indicating prices could continue rising.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
