Last week, the cryptocurrency market experienced significant turbulence: after a rapid surge, participants faced an equally swift pullback, which particularly affected altcoins, many of which saw price declines of 10-20%. However, when evaluating the overall trend over a broader time frame, the picture remained positive, reports a correspondent from the Kapital.kz business information center.
Experts emphasized that this was merely a local correction and not a collapse of the entire market. Some analysts spoke of an unexpected and rapid conclusion to the "altcoin season." Felix Hartmann, managing partner of the investment company Hartmann Capital, is convinced that this time has "run its course" and warned of a sharp drop in altcoins. He wrote: "At that moment, most altcoins had annual funding rates exceeding 100%. The recent price spikes were entirely dictated by the perpetual futures market, while spot volumes were declining. That’s why the upcoming pullback would appear extremely destructive." In his view, market participants might continue to act irrationally, but during that period, teams and venture investors began significantly reducing their investment volumes. He cautioned, "Once the momentum fades, we will need to shed excessive leverage and face extremely painful wick formations." Felix Hartmann likely recalled the situation in 2021 when, after a dizzying rise, several altcoins rapidly crashed over a few months.
Not all members of the crypto community share this pessimistic view; some believe that the true altcoin season has only just begun. Certain analysts have suggested a potential cycle lasting about 90 days, from December 2024 to March 2025. Traditionally, a key signal for the start of the alt season has been a decrease in Bitcoin's dominance. At the time of assessment, it stood at 55.14%, down 7.8% from the previous month. Notably, Ethereum's dynamics, as the second most significant crypto asset, also showed a substantial rise but failed to maintain the achieved levels. Last week, on December 6, the price of Ether surpassed $4000 for the first time since March. Noted crypto trader Scott Melker reminded that on December 5, spot exchange-traded funds based on Ethereum showed a record inflow of $428.5 million. At the end of November, specialists from Block Scholes and Bybit Analytics concluded that the growing interest from investors and expectations of regulatory easing could create conditions for Ethereum to rise above the $4000 mark by the time of Donald Trump's inauguration. Before this, Ether had risen to around $3700, demonstrating faster growth rates than Bitcoin, and, according to QCP Capital, stimulated capital flow from the leading cryptocurrency into other digital assets.
Amid significant volatility, large institutions decided to capitalize on the situation and increase their reserves. Regarding the activity of institutional players, MicroStrategy made headlines again. The company acquired an additional 21,550 BTC for $2.1 billion. This was reported by the corporation's founder, Michael Saylor. In a report to the U.S. Securities and Exchange Commission, it was clarified that the purchase was made at an average price of $98,783 per coin. The yield for the last quarter reached 43.2%, and for the year — 68.7%. MicroStrategy has built an impressive portfolio of 423,650 BTC, acquired for a total of $25.6 billion, which is equivalent to approximately $60,324 for each coin. In an interview with Yahoo Finance, Michael Saylor shared his approach to long-term Bitcoin investments, stating that his strategy is entirely transparent. He emphasized: "Every day for the past four years, I have persistently urged: buy Bitcoin and do not sell it. I always intended to acquire even more coins. I planned to buy the first cryptocurrency even at the highest price peaks" and recommended: "Just continue directing your free capital to buy Bitcoin, as this asset will inevitably strengthen against the dollar in the long term." He pointed out that Bitcoin should be viewed as a long-term capital asset, provided that this money will not be needed within four or, preferably, ten years, and can be allocated to Bitcoin, averaging the purchase cost quarterly. This way, one can expect that value will remain stable for a decade and longer, not placing excessive importance on short-term price fluctuations. Michael Saylor noted that even without a full understanding of all mechanisms of Bitcoin, its application remains significant. He emphasized that MicroStrategy successfully increased shareholder capital simply by holding the digital asset. According to him, investors do not need to understand the details — it is enough to own Bitcoin and allow the market to increase its value.
Against the backdrop of ongoing volatility, the "buying on dips" strategy could remain relevant much longer than most anticipated. This was stated by Daniel Chung, co-founder of Syncracy Capital. He noted that the psychology of market participants has changed in this cycle: while many investors previously adhered to a holding strategy and accumulated assets during downturns, now they are eager to lock in profits, complicating precise timing for trades. However, this shift, in Daniel Chung's view, could lead to a longer-term upward trend and the formation of a "true peak."
Pressure on prices may also have been exerted by Bitcoin holders with over 10 years of experience. At the peak on December 5, significant transactions were recorded from these long-term holders, which became one of the reasons for the sharp price drop to around $90,500, as noted by CryptoQuant. Soon after, prices returned to the $102,000 range, but the activation of on-chain metrics intensified again, hinting at further selling pressure. Analysts at Glassnode identified intermediate resistance around $99,559, where a large accumulation zone (about 125,000 BTC) formed below the $100,000 threshold. As support, experts indicated a range of $96,000–98,000, where about 120,000 BTC were purchased and where the asset temporarily stabilized.
In addition to analyzing internal market processes and investor capital, technological factors capable of significantly impacting the stability of cryptocurrency systems have become important. Many community members have focused on Google’s latest achievements in quantum computing. According to several industry representatives, such innovations could potentially threaten blockchain stability. Emin Gün Sirer, founder and CEO of Ava Labs, proposed considering the idea of freezing 1 million BTC owned by Satoshi Nakamoto to minimize risks associated with the development of quantum technologies. He pointed out that the presumed wallets of Bitcoin’s creator operated with the early P2PK format, which fully revealed the public key, potentially giving attackers time to perform quantum brute-forcing. Modern addresses like P2PKH are more secure as they only publish the hash of the key. Emin Gün Sirer concluded: "As quantum computers have become a threat, the Bitcoin community could consider freezing Satoshi's coins or, more generally, setting a deadline for the format and freezing all assets on P2PK." However, this idea sparked controversy. Some participants noted that it is at least contradictory, reminding about property rights and that the specific risks of quantum hacking remain rather vague. The founder of the Flow AI platform wrote: "The ability to access the old wallet format is more of a feature than a flaw. A century from now, it may resemble the discovery of a long-lost galleon full of gold."
At the end of the past seven-day reporting period, the total capitalization of the cryptocurrency market fell below the psychological mark of $3.5 trillion. As of the evening of Wednesday, December 11, 2024, it stood at $3.34 trillion, which is 2.91% lower than the values recorded at the end of the previous reporting period.
1. Bitcoin (BTC). As of the evening of Wednesday, December 11, 2024, the price of "digital gold" was recorded at around $94,937, failing to hold above $95,447. Over the past week, Bitcoin's price decreased by 0.53%. Despite the moderate price correction, the share of the first cryptocurrency in the overall market capitalization rose by 1.78 percentage points, reaching 56.58% by the end of the reporting period. The increase in share amid declining overall capitalization indicates a continued concentration of investor attention on Bitcoin.
2. Ethereum (ETH). As of the evening of Wednesday, December 11, 2024, "digital oil" decreased in price from $3,573 to $3,560, with a negative dynamic of 0.36% over the week. The share of Ether in the overall cryptocurrency market capitalization increased by 0.4 percentage points, reaching 12.9%. Despite the price correction, investors remain confident in Ethereum's long-term prospects and continue to hold significant positions in this asset.
3. Ripple (XRP). As of the evening of Wednesday, December 11, 2024, the price of the "banking cryptocurrency" significantly decreased. The token's price dropped from $2.53 to $1.99