This Wednesday, major cryptocurrency prices are mostly stagnant as investors tread carefully. This market pause is attributed to low holiday trading volumes, expectations surrounding forthcoming U.S. economic reports, and a significant options expiry event this week.
Summary
- Cryptocurrency prices have seen slight declines on Wednesday, driven by thin holiday liquidity.
- Traders are anticipating a key U.S. economic data report scheduled for later today.
- A major options expiry event set for Friday is contributing to the market’s cautious sentiment.
As per CoinGecko’s data, the total crypto market capitalization dipped slightly by 0.7%, reaching $3.02 trillion as of the latest update on Wednesday, Dec. 24, Asian time. Bitcoin (BTC), the leading cryptocurrency by market cap, fluctuated between $86,800 and $88,100 before settling around $87,000, experiencing a 0.5% decrease over the past day.
Ethereum (ETH) fell by 0.8% to $2,940, while other major cryptocurrencies such as BNB (BNB), XRP (XRP), Solana (SOL), and Tron (TRX) saw losses ranging from 1% to 2%. In contrast, smaller-cap tokens like Midnight (NIGHT), Pump.fun (PUMP), and Uniswap (UNI) emerged as the largest losers, recording losses of 14%, 8%, and 7%, respectively.
Prior to the Christmas holiday—a period typically associated with reduced trading volumes as traders take profits—investors are adopting a conservative approach and minimizing exposure to riskier assets.
Data from CoinGlass indicates that the total futures open interest in the crypto market has fallen by 1.3% in the past 24 hours, totaling $128.1 billion. Meanwhile, spot market volume has decreased by 10% to $101 billion.
Investor demand is being tempered by a mix of macroeconomic challenges and anticipated market events. Currently, the Crypto Fear & Greed Index stands at 24, reflecting ongoing “Extreme Fear.”
Today, cryptocurrency prices remain depressed as traders await the release of U.S. jobless claims later on. Predictions suggest claims may rise slightly to around 223,000–225,000. Such hotter-than-expected results could intensify pressure on the Fed regarding potential rate cuts.
That said, recent statements from various Fed officials, including the chair, have set a more hawkish outlook for rate reductions, at least for early 2026. Cryptocurrencies typically rally on hopes of rate cuts but tend to pull back when such expectations are deferred or deemed unlikely in the near future.
Just days ago, a bearish sentiment swept through the market following the Bank of Japan’s decision to raise interest rates to 0.75%, the highest in three decades, juxtaposed with the Fed’s reduction of rates to a range of 3.50%-3.75% in December.
The cryptocurrency market has historically exhibited volatility during periods of rising interest rates from the BoJ, as this can bolster the yen and potentially unwind “carry trades” that involve borrowing in Japan to invest in riskier, higher-yielding assets elsewhere.
Record options expiry spooks investors
Moreover, traders are bracing for the impending expiry of nearly $27 billion to $28.5 billion worth of Bitcoin and Ethereum options on Deribit, scheduled for Friday, Dec. 26.
If the record expiry occurs, it will signify the largest expiry in the exchange’s history.
The hedging strategies employed by market makers surrounding the “max pain” price (currently estimated at approximately $96,000 for BTC) may keep prices restrained until the expiry event. However, it is important to note that post-expiry, there could be a relief rally or increased volatility as the mechanical hedging pressure eases, allowing the market to reset for 2026.
Disclosure: This article does not constitute investment advice. The content and materials presented here are intended solely for educational purposes.
