As the year-end approaches, turbulence has rocked the cryptocurrency markets. In a tumultuous start to the week, massive sell-offs have emerged as a defining feature. Bitcoin has notably descended, testing depths below $85,000, while Ethereum, the premier altcoin, dipped under $3,000. The market saw liquefactions amounting to about $600 million on Monday, with daily averages near $400 million throughout the week.
Why Are BTC and ETH Dominating Now?
According to Wintermute’s December 23, 2025 report, market fluctuations are beginning to moderate, with Bitcoin moving back to the $90,000 level. The analysis indicates a concentrated market focus on Bitcoin and Ethereum as liquidity tightens during the Christmas season. Altcoins, on the other hand, show signs of stress, grappling with a “supply overhang” and sluggish coin unlocking patterns.
Where Does This Leave Altcoins?
Liquidity during the festive period tends to decrease, impacting market dynamics. As volatility ensues, the most liquid assets, Bitcoin and Ethereum, become focal points of market risk absorption, influenced more by strategic trading than clear trends. Data from Wintermute echoes this, showing altcoins underperformed with a 3.5% decline during December 15–21, while Bitcoin recorded marginal gains alongside traditional assets like gold.
Altcoins’ struggles largely stem from overwhelming supply pressures, described in the report as a “supply overhang,” combined with extensive coin unlocking schedules. Retail investors are beginning to migrate back to major cryptocurrencies, supporting the belief that Bitcoin must lead for sustained market confidence.
Do Current Trends Favor Top Cryptos?
Wintermute’s internal data suggests revived buying interest in major cryptocurrencies. A persistent buying trend for Bitcoin is noted, with Ethereum experiencing similar pressures. Institutional purchases have been a stable element since summer, with retail investors moving away from altcoins in favor of top-tier digital currencies.
Price discovery through derivatives is driving significant intra-day volatility. Despite the tumult, market expectations remain bifurcated, predicting a balance in the $80,000 range or a return to previous highs. Wintermute foresees subdued activity and range-bound market movements continuing until year’s end.
Given the present conditions, some key takeaways for market participants include:
- Institutional buying remains a strong factor, helping buoy Bitcoin and Ethereum.
- Retail investors are increasingly focusing on more established cryptocurrencies.
- Volatility continues in derivatives markets, impacting price discovery significantly.
As the year concludes, selective risk-taking remains prevalent. Wintermute’s predictions suggest that unless significant macro events intervene, the markets will continue to witness strategic positioning over directional trend-setting.
