DCW DAILY BRIEF-Global Digital Assets, ScienceTech & Web3 Market Intelligence
DCW DAILY BRIEF-Global Digital Assets, ScienceTech & Web3 Market Intelligence
Date: December 24th, 2025 | Wednesday Edition #363
Including Looking Ahead - January 2026
In partnership with BCB Group | TPX property Management | Vault12 | Wincent | World Mobile
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James Bowater
linkedin.com/in/james-bowater-b47612
Twitter/X: X.com@TheDCW_JB
https://www.thedigitalcommonwealth.com/
Next Event: https://www.thedigitalcommonwealth.com/
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Warmest wishes from the DCW team as we enter the festive season. To all our readers across our Community and beyond, whether you're celebrating Christmas, preparing for the New Year, observing other cultural traditions, or simply enjoying time with family and friends, we wish you peace, prosperity, and well-being. Thank you for being part of our community throughout 2025. We look forward to continuing our journey together in the year ahead. Next Daily Brief will be published on January 5th, 2026
π Executive Summary
Bitcoin traded near $87,000 on Wednesday, December 24th, as cryptocurrency markets entered the final hours before Christmas, maintaining consolidation within tight ranges amidst thin holiday liquidity and persistent macroeconomic crosscurrents. The world's largest digital asset declined approximately 1.5% from Tuesday's levels, falling below the $88,000 threshold that had provided technical support throughout the week. The Crypto Fear & Greed Index remained unchanged at 24, firmly entrenched in extreme fear territory for a 15th consecutive day, whilst total cryptocurrency market capitalisation declined to approximately $3.04 trillion. Bitcoin dominance held near 57.4%, reflecting continued flight-to-quality dynamics within digital asset markets. Β
Wednesday's Christmas Eve session saw broader cryptocurrency weakness, with Ethereum declining 1.5% to hover near $2,960, whilst XRP fell 1.9% to $1.86. Solana experienced sharper losses, declining 2.9% to $121, marking one of the week's more pronounced corrections amongst major altcoins. The privacy coin sector, which had already declined sharply on Tuesday, continued to consolidate at lower levels. 24-hour liquidations remained elevated at approximately $220 million, whilst cryptocurrency open interest held near $129 billion, suggesting that whilst leverage persists, traders remain cautious about establishing aggressive directional bets ahead of Thursday's market closure for the Christmas holiday. Β
Tuesday's U.S. equity markets posted their fourth consecutive session of gains, with the S&P 500 advancing 0.46% to a new all-time high of 6,909.79, the Dow Jones Industrial Average climbing 0.16% to 48,442.41, and the Nasdaq Composite rising 0.57% to 23,561.84. Technology stocks again led the advance, with Nvidia gaining nearly 3% and Broadcom rising more than 2%, whilst energy and utilities sectors also contributed solid gains. The rally occurred despite stronger-than-expected Q3 GDP data showing 4.3% annualised growth, versus expectations of 3.3%, which initially trimmed rate-cut expectations but ultimately failed to derail equities' Santa Claus rally. The VIX volatility index declined to approximately 13.80, indicating reduced market stress as investors maintained optimism despite robust economic growth tempering Fed easing expectations. Β
Precious metals extended their extraordinary 2025 rally to historic proportions on Tuesday and Wednesday, with gold rising above $4,500 per troy ounce for the first time, marking the 50th record-breaking session this year. Silver made history by breaching $70 per ounce, whilst copper also set a fresh record above $12,000 per ton. Gold's 70% year-to-date gain represents its strongest annual performance since 1979, whilst silver's 140% surge has outpaced even the most optimistic forecasts. These precious metals gains occurred alongside equity market strength, reflecting diverse drivers: Federal Reserve rate-cut expectations, persistent geopolitical tensions involving Venezuela, safe-haven demand, and, for copper, acute supply constraints combined with AI data centre infrastructure buildouts. Β
Market positioning ahead of the Christmas holiday became increasingly defensive, with crypto ETF flows remaining negative and institutional appetite subdued. Ethereum ETFs extended their outflow streak to eight consecutive trading days, whilst Bitcoin product flows showed mixed results. The divergence between traditional equities hitting record highs and cryptocurrency markets struggling near recent lows highlights the distinct sentiment dynamics across asset classes. Wednesday marks the final abbreviated trading session before U.S. stock markets close early at 1:00 PM ET, followed by complete closure on Thursday for Christmas, creating an environment where thin liquidity could amplify any unexpected price movements across both traditional and digital asset markets.
π° Today's Headlines
πΉ Markets
β’ Bitcoin falls below $88,000, down 1.5% in pre-Christmas trading
β’ Ethereum declines 1.5% to hover near $2,960 psychological level
β’ XRP drops 1.9% to $1.86 as year-end de-risking intensifies
β’ Solana falls 2.9% to $121, amongst sharper major altcoin declines
β’ Fear & Greed Index unchanged at 24, extreme fear persists for 15th day
β’ Total crypto market cap falls to $3.04 trillion amidst holiday thinning
β’ 24-hour liquidations remain elevated near $220 million
β’ S&P 500 hits fresh record at 6,909.79, up 0.46% in fourth straight gain
β’ Gold breaches $4,500 for the first time, silver makes history above $70
β’ Copper sets new record above $12,000 per ton on supply constraints
ποΈ Institutional & Corporate
β’ VanEck forecasts dominant Bitcoin rebound amid global liquidity shift
β’ Institutional disengagement deepens as crypto ETF flows remain negative
β’ Ethereum ETFs extend outflow streak to eight consecutive trading days
β’ Former FTX US President raises $35M to build perpetual exchange for TradFi assets
β’ Trade Republic reaches β¬12.5bn valuation in β¬1.2bn secondary share sale
β’ Nomura International Wealth Management expands DIFC presence with new Dubai premises
β’ flatexDEGIRO hit with β¬560,000 BaFin fine for fee disclosure failures
βοΈ Regulatory & Policy
β’ SEC cracks down on AI-themed crypto fraud that cost investors $14M
β’ Bank of Russia proposes a comprehensive framework for retail crypto access
β’ Spain accelerates digital asset oversight with 2026 MiCA and DAC8 implementation
β’ Fed Payments Innovation Conference discusses crypto, stablecoins, and AI integration
π€ Technology & Innovation
β’ tZERO expands tokenisation infrastructure with new Layer-1 integrations
β’ Coinbase integrates Solana deposits and withdrawals via the Base network
β’ Bybit introduces specialised insurance fund pools to curb trading risk
β’ Gnosis executes hard fork to recover funds from $116M Balancer hack
β’ Crypto.com builds in-house market maker as prediction markets expand
β’ FanDuel and CME Group launch FanDuel Predicts, bringing event trading to mainstream audiences
π Market Overview
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π TOTAL CRYPTO MARKET CAP: $3.04 TRILLION
24h Change: βΌ1.5% | Bitcoin Dominance: 57.4%
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π° Digital Assets Performance
βΏ BITCOIN (BTC)
Price: $87,000 βΌ1.5% (24h)
π 24h Volume: ~$40 Billion
π Market Cap: $1.73 Trillion
π Dominance: 57.4%
Bitcoin traded near $87,000 on Wednesday, December 24th, declining approximately 1.5% as cryptocurrency markets entered the final hours before the Christmas holiday. The world's largest digital asset slipped below the $88,000 psychological threshold that had provided technical support throughout Tuesday's session, as thin holiday liquidity and continued year-end tax-loss harvesting weighed on prices. Bitcoin briefly tested resistance near $88,300 during early Asian trading before retreating throughout the European and U.S. sessions, continuing the pattern of volatility and consolidation that has characterised December trading.
The cryptocurrency's struggle to sustain momentum above $90,000 reflects broader market caution, with derivatives markets showing neutral-to-slightly negative funding rates and elevated liquidations suggesting leveraged positions continue to be squeezed despite relatively stable spot prices. Market participants now await Thursday's Christmas market closure and the subsequent return of liquidity in the new year, with technical analysts noting that Bitcoin's hold above the $85,000 support level remains crucial for maintaining near-term bullish structure. A decisive break below this level could target the psychological $80,000 zone, whilst a recovery above $90,000 would potentially open upside toward $95,000-$100,000.
Despite near-term price weakness, on-chain metrics suggest underlying network strength persists. Hash rate remains elevated despite the recent 4% monthly decline noted by VanEck, indicating continued miner confidence despite tighter profit margins. Digital Asset Treasuries have continued to accumulate Bitcoin throughout December, with aggregate holdings now exceeding 1 million BTC, demonstrating corporate conviction independent of short-term price action. This accumulation by long-term holders contrasts with Bitcoin ETF outflows, highlighting the divergence between institutional product redemptions and corporate balance sheet strategy.
Ξ ETHEREUM (ETH)
Price: $2,960 βΌ1.5% (24h)
π 24h Volume: ~$15 Billion
π Market Cap: $357 Billion
π BTC Ratio: 0.034 ETH/BTC
Ethereum declined 1.5% on Wednesday to trade near $2,960, hovering precariously close to the psychologically significant $3,000 threshold. The world's second-largest cryptocurrency has struggled to maintain momentum throughout December, with Wednesday's session marking another failed attempt to establish support above $3,000. Ethereum briefly tested $3,010 during overnight Asian trading before sellers overwhelmed buyers, pushing prices back toward the lower end of the recent $2,800-$3,100 range.
Ethereum ETFs extended their outflow streak to an eighth consecutive trading day on Tuesday, bringing cumulative December redemptions to approximately $550 million. This persistent institutional selling pressure contrasts sharply with the relatively resilient price action, suggesting that spot market buyers are absorbing ETF-related selling without dramatic price dislocations. However, the prolonged ETF outflows indicate reduced institutional conviction in Ethereum specifically, even as the broader narrative around blockchain technology and tokenisation remains robust.
From a technical perspective, Ethereum's inability to reclaim and hold $3,100-$3,200 resistance keeps the cryptocurrency vulnerable to further downside testing. Immediate support lies near $2,900, with deeper correction targets at $2,800 and potentially $2,700 if selling pressure intensifies. Conversely, a decisive breakout above $3,100 accompanied by increased volume would signal renewed bullish momentum, potentially targeting the $3,300-$3,500 zone. Network fundamentals remain solid, with transaction activity stable and development work on scalability improvements continuing. However, near-term price action appears driven primarily by macroeconomic factors and year-end positioning rather than Ethereum-specific catalysts.
π· XRP
Price: $1.86 βΌ1.9% (24h)
π 24h Volume: ~$2.4 Billion
π Market Cap: $113 Billion
π 30-Day Change: βΌ10%
XRP declined 1.9% on Wednesday to trade at $1.86, struggling to reclaim the $2.00 threshold that had provided psychological support earlier in December. The cryptocurrency, which surged dramatically following Donald Trump's election victory on hopes of regulatory clarity, has now retraced more than 50% from its recent highs above $3.84 reached in early January 2018. Wednesday's price action reflects continued year-end de-risking, as traders reduce exposure ahead of the Christmas holiday and amid increased market uncertainty.
Despite near-term price weakness, institutional interest in Ripple-linked assets remains strong. Franklin Templeton's spot XRP ETF now holds over 100 million XRP, demonstrating continued institutional accumulation even as spot prices decline. Additionally, Ripple's recent launch of its RLUSD stablecoin represents a significant strategic expansion, positioning the company to compete in the growing USD-backed stablecoin market alongside established players like Tether and Circle. These developments suggest that whilst near-term price action remains challenged, the longer-term fundamentals supporting XRP's utility in cross-border payments continue to strengthen.
XRP's price trajectory in 2026 will likely depend heavily on regulatory developments, particularly regarding the potential approval of spot XRP ETFs. With Paul Atkins heading the SEC under the Trump administration, the likelihood of such approvals has increased materially, though precise timing remains uncertain. Technical support for XRP currently sits near $1.80, with deeper correction targets at $1.70 and $1.60 if current weakness persists. Resistance lies at $2.00, followed by $2.20 and $2.50 on any recovery.
β SOLANA (SOL)
Price: $121 βΌ2.9% (24h)
π 24h Volume: ~$2.8 Billion
π Market Cap: $58 Billion
π 30-Day Change: βΌ8%
Solana experienced one of the sharpest declines amongst major cryptocurrencies on Wednesday, falling 2.9% to trade at $121. The high-performance blockchain's token price has struggled throughout December despite continued robust network activity, highlighting the disconnect between on-chain utility and token price performance that has characterised much of the Layer-1 sector in Q4 2025. This structural decoupling between network usage metrics and token valuations is a broader theme across major blockchain ecosystems, where institutional milestones and total value locked have increased alongside negative or flat token returns.
Despite price weakness, Solana's decentralised exchange ecosystem continues demonstrating impressive strength. Solana-based DEXs have consistently rivalled or exceeded spot volumes of major centralised exchanges throughout December, driven by Jupiter and Orca liquidity aggregators processing billions in daily volume. This sustained network activity with Solana DEXs processing transactions that rival or exceed those of centralised exchanges validates the blockchain's technical capabilities and ecosystem development, suggesting that current price levels may represent attractive entry points for investors focused on fundamental network metrics rather than short-term sentiment.
Coinbase's recent integration of Solana deposits and withdrawals via its Base network represents a significant infrastructure development, improving accessibility and reducing friction for users moving between Layer-1 blockchains. This cross-chain interoperability aligns with broader industry trends toward seamless asset movement across different blockchain ecosystems. Technical support for SOL currently sits near $115-$118, with downside targets at $110 if selling pressure persists. Resistance lies at $130, followed by $140 on any recovery.
πΊ CARDANO (ADA)
Price: $0.36 βΌ2.5% (24h)
π 24h Volume: ~$580 Million
π Market Cap: $12.8 Billion
π 30-Day Change: βΌ12%
Cardano declined 2.5% on Wednesday to trade at $0.36, extending its recent weakness amid thin holiday liquidity in the broader altcoin market. The cryptocurrency continues consolidating following the December 11th Midnight blockchain testnet launch, with the privacy-focused sidechain aimed at providing confidential transactions whilst maintaining Cardano's security guarantees. However, the Midnight token itself has experienced significant volatility, declining sharply from recent highs as speculative fervour waned and profit-taking intensified, with the token plunging 23% in earlier sessions this week.
Cardano's methodical, research-driven development approach continues to appeal to enterprises seeking robust, academically validated blockchain infrastructure. The network's focus on scalability improvements through its rigorous peer-reviewed methodology, governance enhancements via its treasury system, and institutional adoption efforts positions it as a potential beneficiary of growing enterprise blockchain demand in 2026. The recent Midnight testnet represents a significant technical advancement, enabling privacy-preserving transactions that could attract institutional users requiring confidential business logic whilst benefiting from Cardano's proven security model.
However, near-term price action appears challenged by broader market weakness and reduced speculative appetite for lower-capitalisation Layer-1 tokens. Cardano's development roadmap continues progressing toward enhanced scalability and interoperability features, though market participants appear focused primarily on macroeconomic headwinds rather than technical milestones. Technical support sits near $0.34-$0.35, with resistance at $0.38-$0.40.
π DOGECOIN (DOGE)
Price: $0.13 βΌ2.9% (24h)
π 24h Volume: ~$1.2 Billion
π Market Cap: $19.2 Billion
π 30-Day Change: βΌ15%
Dogecoin fell 2.9% on Wednesday to trade at $0.13, continuing the memecoin sector's broader cooling throughout Q4 2025. The cryptocurrency, which maintains its position amongst the top ten digital assets by market capitalisation despite reduced speculative interest, has seen trading volumes decline significantly from January 2025 peaks when memecoin mania drove unprecedented retail participation. Weekly DEX volumes for the memecoin sector have dropped 95% from earlier highs, reflecting waning retail enthusiasm for speculative tokens as market conditions deteriorated and capital rotated toward more established digital assets.
Despite reduced trading activity, Dogecoin maintains a loyal community. It continues to benefit from periodic celebrity endorsements, particularly from Elon Musk, whose social media posts and business decisions have historically influenced DOGE price movements. The cryptocurrency's simple, accessible brand and established network effects provide some insulation from complete irrelevance. However, its lack of sophisticated technological features or straightforward utility beyond payments leaves it vulnerable to changing market narratives. DOGE's correlation with broader cryptocurrency market sentiment remains exceptionally high, leaving it exposed to continued weakness if Bitcoin fails to establish upward momentum.
From a technical perspective, Dogecoin faces immediate support near $0.125, representing a psychological threshold that has provided buying interest during recent weakness. Deeper downside targets sit at $0.115 and potentially $0.10 if memecoin selling pressure intensifies further. Resistance lies at $0.140, followed by $0.155 on any recovery driven by renewed retail speculation or positive sentiment catalysts. The cryptocurrency's future likely depends more on broader market conditions and social media dynamics than fundamental developments, given its minimal technical roadmap compared to competing blockchains.
π Market Sentiment Indicators
π¨ Fear & Greed Index: 24 (Extreme Fear) β
The Crypto Fear & Greed Index remained unchanged at 24 on Wednesday, maintaining its position firmly in extreme fear territory for a 15th consecutive day. This persistence reflects ongoing market anxiety as βΏBitcoin continues struggling to establish momentum above $90,000 despite multiple attempts throughout December. The index, which synthesises data from volatility (25%), market volume (25%), social media sentiment (15%), surveys (15%), Bitcoin dominance (10%), and Google Trends (10%), continues to suggest pervasive pessimism amongst cryptocurrency market participants. Β
Historically, prolonged periods of extreme fear have often preceded significant market rebounds, as deeply pessimistic sentiment typically indicates that most weak hands have already sold, leaving primarily conviction holders. However, current conditions complicate near-term forecasts: elevated liquidations, persistent ETF outflows, thin holiday liquidity, and year-end tax-loss harvesting all create genuine headwinds independent of sentiment extremes. The unchanged reading at 24 (up from 17 a week ago but well below the neutral territory of 50) suggests markets remain paralysed by uncertainty rather than gripped by panic-selling. Β
Funding Rates: Neutral (~0.001% to +0.002%)
Bitcoin perpetual futures funding rates remained neutral to slightly positive across major exchanges on Wednesday, ranging from approximately 0.001% to +0.002%, indicating balanced positioning amongst derivatives traders. These minimal funding rates suggest neither bulls nor bears hold firm conviction, with the funding rate mechanism keeping perpetual contract prices closely aligned with spot markets without either side paying significant premiums for prolonged exposure. Β
The neutral funding environment, alongside elevated liquidations, creates an interesting dynamic: whilst leverage remains in the system, traders appear unwilling to place aggressive directional bets ahead of the Christmas holiday. This cautious positioning may continue through year-end, with more decisive directional moves potentially emerging only after markets reopen with fuller liquidity in January 2026. Β
Open Interest: $129 Billion β
Total cryptocurrency open interest held near $129 billion on Wednesday, remaining roughly flat from Tuesday's levels. This stability suggests leverage is neither building aggressively nor deleveraging meaningfully, with market participants maintaining existing positions rather than establishing new ones ahead of the holiday closure. CME Bitcoin futures open interest remains near $10.9 billion, down from early November peaks of $16 billion but stable throughout December. Β
The $28 billion Bitcoin and Ethereum options that expired on December 26th (Thursday) represented the largest single expiry in Deribit's history. With this major hedging event now complete, market makers' need to delta-hedge their exposure through spot market trades has diminished, potentially allowing for more natural price discovery in the days ahead. However, thin holiday liquidity may limit meaningful directional moves until fuller participation returns in January. Β
Liquidations: $220 Million (24h) β
24-hour liquidations held near $220 million on Wednesday according to CoinGlass data, remaining elevated from earlier in the week. This persistent liquidation activity indicates stress continuing beneath the surface despite Bitcoin's relatively stable trading within the $86,000-$89,000 range. The combination of thin holiday liquidity and existing leverage creates conditions in which even modest price movements trigger cascading liquidations of over-leveraged positions. Β
The sustained liquidation levels throughout December suggest that market participants continue attempting to re-establish leveraged positions despite obvious risks, only to see these positions forcibly closed during intraday volatility spikes. This pattern creates a precarious environment in which sudden price movements in either direction could trigger larger, cascading liquidations. Until leverage is more comprehensively reset or market participants adopt more conservative position sizing, elevated liquidation risk will likely persist. Β
ποΈ Traditional Markets Context
U.S. Equity Markets (Tuesday Close, December 23rd)
β’ S&P 500: 6,909.79 β²0.46% (31.60 points) - New All-Time High
β’ Dow Jones: 48,442.41 β²0.16% (79.73 points)
β’ Nasdaq Composite: 23,561.84 β²0.57% (133.01 points)
β’ VIX: 13.80 βΌ1.99%
U.S. equity markets extended their winning streak to four consecutive sessions on Tuesday, December 23rd, with the S&P 500 posting a fresh all-time high of 6,909.79. Technology stocks again led the advance, with artificial intelligence names anchoring the rally. Nvidia shares gained nearly 3%, whilst Broadcom rose more than 2%, as the broader AI infrastructure narrative continued to attract capital despite earlier-month volatility. The Nasdaq Composite's 0.57% gain outpaced both the S&P 500 and the Dow Jones Industrial Average, reflecting continued investor preference for growth-oriented technology exposures. Β
Tuesday's session occurred against the backdrop of stronger-than-expected Q3 GDP data, which showed the U.S. economy expanding at a 4.3% annualised rate versus expectations of 3.3%. This robust growth initially trimmed expectations for aggressive Federal Reserve easing, with market-implied probability of a January rate cut falling to approximately 13%. However, traders continue to price in two 25-basis-point cuts by the end of 2026, reflecting expectations that, whilst the economy remains resilient, moderating inflation and gradually cooling labour markets will eventually prompt policy normalisation. Β
The VIX volatility index declined to 13.80, its lowest level in recent weeks, indicating reduced market stress and increased investor confidence. Energy and utilities sectors also posted solid gains on Tuesday, whilst consumer confidence data showed continued deterioration, declining for a fifth consecutive month despite generally positive economic indicators. This divergence between complex economic data (GDP, employment) and soft sentiment measures (consumer confidence, small business optimism) highlights the complex psychological dynamics underlying current market conditions. Β
Looking ahead, U.S. stock markets will close early at 1:00 PM ET on Wednesday, December 24th, followed by complete closure on Thursday, December 25th, for the Christmas holiday. This abbreviated trading schedule creates conditions for potentially increased volatility in thin trading, though historically, the so-called Santa Claus rally period (covering the final five trading days of the year and the first two of the new year) has often produced positive returns. The S&P 500 now trades just below its intraday all-time high of 6,920.34, with Wall Street hoping year-end positioning will drive further gains. Β
Commodities
β’ Gold: $4,500+ per ounce (new all-time high, +70% YTD 2025)
β’ Silver: $70+ per ounce (first time, +140% YTD 2025)
β’ Copper: $12,000+ per ton (new record high, +40% YTD)
β’ WTI Crude Oil: ~$57 per barrel
β’ Brent Crude: ~$61 per barrel
Precious metals achieved historic milestones on Tuesday and Wednesday, with gold, silver, and copper all simultaneously reaching record highs, a phenomenon last observed in 1980. Gold breached $4,500 per troy ounce for the first time, marking the 50th record-breaking session in 2025 and cementing a 70% year-to-date gain, the strongest annual performance since 1979. Silver's ascent proved even more dramatic, surging above $70 per ounce for the first time in history, representing a 140% year-to-date gain that has outpaced nearly all major asset classes. Β
Multiple factors are driving this unprecedented precious metals rally. First, expectations of Federal Reserve rate cuts in 2026 reduce the opportunity cost of holding non-yielding assets like gold and silver, making precious metals more attractive relative to interest-bearing securities. Second, persistent geopolitical tensions, particularly escalating U.S.-Venezuela friction involving oil tanker seizures, have amplified safe-haven demand. Third, sustained central bank gold purchases, especially by emerging market central banks seeking to diversify reserves away from dollar assets, have provided consistent buying pressure. Β
For silver specifically, supply and demand dynamics have tightened dramatically. London Metal Exchange silver inventories have plummeted by approximately 75% from 2019 peaks, whilst industrial demand from solar energy installations, electronics manufacturing, and electric vehicle production continues to grow. Silver's dual role as both a precious metal and an industrial commodity positions it to benefit from both safe-haven flows and green energy transition demand, explaining its outperformance relative to gold. Β
Copper's record surge above $12,000 per ton reflects acute supply constraints overlapping with surging demand. Mine disruptions across the Americas and Africa have constrained output just as AI data centre construction and electric vehicle production drive explosive demand growth. Each AI data centre requires vastly more copper wiring than traditional facilities, whilst each electric vehicle uses approximately 60 kilograms more copper than internal combustion engine vehicles. BloombergNEF forecasts copper markets could enter deficit as early as 2026, with some analysts projecting prices could reach $13,000 per ton by mid-2026. Β
The simultaneous record highs across gold, silver, and copper underscore profound shifts in global commodity markets. For cryptocurrency investors, gold's 70% 2025 gain versus Bitcoin's struggle to maintain $90,000 highlights divergent performance despite both assets being positioned as alternatives to fiat currency. This divergence reflects gold's established safe-haven status and institutional acceptance versus cryptocurrency's perceived risk profile and regulatory uncertainty. Looking ahead, precious metals' momentum may continue if Fed easing materialises and geopolitical tensions persist, though some analysts warn that current levels already reflect substantial forward expectations. Β
π Market Narrative & Analysis
Bitcoin's Christmas Eve consolidation near $87,000 encapsulates the broader cryptocurrency market's struggle to establish directional conviction as 2025 draws to a close. The anticipated Santa Claus rally has largely failed to materialise in digital asset markets, with the world's largest cryptocurrency unable to reclaim and hold $90,000 despite multiple attempts throughout December. This price action, occurring against a backdrop of persistent extreme fear (Fear & Greed Index at 24 for 15 consecutive days), elevated liquidations, and sustained institutional ETF outflows, suggests that, whilst leverage remains in the system, participants lack conviction about the near-term direction. Β
The market's current technical and sentiment setup presents a complex picture. On one hand, prolonged extreme fear readings, systematic deleveraging since early November, and continued corporate treasury accumulation create conditions that have historically preceded significant rebounds. Digital Asset Treasuries now hold over one million BTC, demonstrating corporate conviction independent of short-term volatility. VanEck's detection of capitulation signals suggests institutional observers believe a near-term bottom may be forming, with the firm forecasting a 'dominant Bitcoin rebound' as global liquidity conditions improve. Β
However, several factors complicate bullish narratives. The $28 billion Bitcoin and Ethereum options expiry on Thursday, December 26th, the largest in Deribit's history, created technical constraints throughout December, with heavy positioning around major strike prices forcing market makers to hedge exposure through spot trades. Whilst this expiry has now passed, thin holiday liquidity may continue limiting meaningful price discovery until fuller participation returns in January 2026. Additionally, the combination of rising open interest (holding near $129 billion) and elevated liquidations ($220 million daily) reveals uncomfortable dynamics: whilst leverage is rebuilding, many positions appear poorly timed or inadequately margined. Β
The divergence between traditional equities and cryptocurrency performance is striking. The S&P 500 hit a fresh all-time high of 6,909.79 on Tuesday, extending gains for a fourth consecutive session, whilst Bitcoin languishes more than 30% below its $126,000 October peak. This divergence reflects distinct sentiment dynamics: equity markets benefit from AI infrastructure optimism, robust Q3 GDP growth (4.3% annualised), and expectations of eventual Fed easing, whilst cryptocurrency markets grapple with regulatory uncertainty, institutional redemptions, and year-end tax-loss harvesting. Β
Perhaps most striking is the extraordinary outperformance of precious metals. Gold's 70% year-to-date gain and silver's 140% surge dwarf Bitcoin's volatile consolidation, challenging the narrative that cryptocurrencies serve as effective inflation hedges or safe-haven assets. The simultaneous record highs in gold, silver, and copper, a phenomenon last observed in 1980underscore profound shifts in global commodity markets driven by Federal Reserve easing expectations, geopolitical tensions, and structural supply-demand imbalances. For Bitcoin proponents who positioned the cryptocurrency as 'digital gold,' this divergence represents a sobering reality check. Β
Looking ahead to 2026, several factors will likely influence the direction of the cryptocurrency market. Regulatory clarity emerging from Michael Selig's CFTC leadership, with his pledge to deliver comprehensive frameworks by the end of Q1 2026, addresses a key industry concern. The potential approval of XRP and Solana spot ETFs under the crypto-friendly Trump administration could unlock significant institutional capital. Global liquidity conditions, particularly if the Federal Reserve begins cutting rates as expected, may create tailwinds for risk assets broadly, including cryptocurrencies. Β
However, near-term challenges persist. Institutional ETF outflows show no signs of abating, with Ethereum products experiencing eight consecutive days of redemptions. Retail enthusiasm appears dampened, as memecoin sector volumes have declined 95% from January peaks. The technical picture suggests Bitcoin remains at a critical juncture: support near $85,000-$86,000 has held throughout December despite numerous tests, whilst resistance at $90,000-$91,000 has proven equally resilient. A decisive break in either direction would likely trigger significant momentum, with downside targets potentially reaching $80,000 and upside objectives extending toward $95,000-$100,000. Β
As markets close for Christmas and participants reflect on 2025's volatile journey, the fundamental question remains: Does current consolidation represent healthy digestion of earlier gains, positioning markets for renewed strength in 2026, or does it signal the beginning of a more significant correction? Historical patterns suggest that prolonged extreme fear, systematic deleveraging, and building institutional interest often precede substantial rallies. Yet the combination of persistent ETF outflows, thin liquidity, and macroeconomic uncertainty creates genuine near-term risks. The answer will likely emerge in January when markets reopen with fuller participation and can assess fundamentals freed from year-end technicalities. Β
π Stablecoins, Tokenisation & Regulatory Frameworks
Regulatory developments continue to shape the digital asset landscape as 2025 draws to a close. Spain announced the accelerated implementation of MiCA (Markets in Crypto-Assets) and DAC8 (Directive on Administrative Cooperation) frameworks for 2026, joining other European Union member states in establishing comprehensive oversight of digital assets. The Spanish Treasury Ministry confirmed that all crypto service providers must register and comply with anti-money laundering requirements by mid-2026, creating more precise operating parameters for exchanges, custodians, and other market participants. Β
The Bank of Russia proposed a comprehensive framework for retail crypto access, representing a significant policy shift for a jurisdiction that previously maintained restrictive stances. The proposed framework would permit retail investors to access cryptocurrency markets through licensed intermediaries, subject to specific capital requirements and investor protection safeguards. This development follows Russia's acknowledgement that Bitcoin mining contributes to ruble stability through foreign currency inflows, highlighting pragmatic policy evolution in response to economic realities. Β
In the United States, the SEC cracked down on AI-themed crypto fraud that cost investors $14 million, demonstrating continued enforcement vigilance even as the broader regulatory posture shifts toward more accommodative frameworks under the Trump administration. The case involved fraudulent claims about artificial intelligence capabilities combined with cryptocurrency investment schemes, highlighting persistent risks in unregulated corners of digital asset markets. Β
The Federal Reserve's Payments Innovation Conference brought together policymakers and industry leaders to discuss crypto, stablecoins, and AI integration with traditional payment systems. These discussions reflect growing recognition amongst central banks that digital assets and blockchain technology will play significant roles in future payment infrastructure, even as regulators work to establish appropriate guardrails. The conference highlighted a particular focus on stablecoin frameworks, with policymakers exploring how to balance innovation with financial stability concerns. Β
Tokenisation infrastructure continues to expand, with tZERO announcing new Layer-1 integrations to broaden access to tokenised securities. The company's platform now supports multiple blockchain networks, enabling issuers to reach diverse investor bases whilst maintaining regulatory compliance. This multi-chain approach reflects industry recognition that no single blockchain will dominate tokenised asset markets, necessitating interoperability solutions that allow seamless movement across different ecosystems. Β
π€ Technology, AI & Innovation
Infrastructure developments dominated technology news this week. Coinbase's integration of Solana deposits and withdrawals via its Base network represents a significant step toward blockchain interoperability, reducing friction for users moving assets between Layer-1 ecosystems. This cross-chain functionality aligns with broader industry trends emphasising seamless user experiences rather than blockchain tribalism, potentially accelerating mainstream adoption by simplifying previously complex cross-chain operations. Β
Gnosis executed a hard fork to recover funds from the $116 million Balancer hack, demonstrating the blockchain community's capacity for coordinated response to security incidents. The hard fork, which required consensus amongst validators and token holders, successfully restored stolen assets whilst preserving network integrity. This incident highlights both the vulnerability of decentralised finance protocols to sophisticated attacks and the resilience of well-governed blockchain networks in responding to crises. Β
Bybit introduced specialised insurance fund pools designed to curb trading risk, representing continued evolution in exchange risk management practices. These segregated pools provide additional protection for traders by ensuring that liquidation cascades in one market don't deplete insurance reserves needed for other products. The development follows several high-profile exchange failures in recent years that exposed inadequate risk controls and insufficient capital buffers. Β
Crypto.com announced the development of an in-house market maker as prediction markets expand, positioning the exchange to capture growing interest in event-based trading. FanDuel and CME Group's launch of FanDuel Predicts similarly brings event trading to mainstream audiences, potentially introducing millions of sports betting enthusiasts to the mechanics of prediction markets. These developments suggest prediction markets may emerge as a significant application driving blockchain adoption beyond pure cryptocurrency trading. Β
Former FTX US President Brett Harrison raised $35 million to build a perpetual exchange for traditional finance assets, demonstrating continued institutional interest in applying cryptocurrency-native derivatives structures to legacy financial instruments. The venture aims to bring 24/7 trading, instant settlement, and transparent on-chain clearing to stocks, commodities, and currencies, potentially disrupting traditional derivatives markets if regulatory frameworks accommodate such innovation. Β
π Global Monetary Policy & Macroeconomic
Tuesday's stronger-than-expected Q3 GDP data showing 4.3% annualised U.S. economic growth materially altered near-term Federal Reserve policy expectations. The market-implied probability of a January rate cut fell to approximately 13% following the release, though traders continue to price in two 25-basis-point cuts by the end of 2026. This reflects expectations that whilst the economy remains resilient, moderating inflation and gradually cooling labour markets will eventually prompt policy normalisation. Β
U.S. Treasury Secretary Scott Bessent floated the possibility of transitioning from the Federal Reserve's fixed 2% inflation target to a range-based system, suggesting 'Once we are back to [2%], which I think will be in sight, then we can have a discussion: Is it much smarter to have a range?' This trial balloon represents a potential fundamental shift in monetary policy frameworks, though implementation would require Federal Reserve cooperation and likely face political obstacles. Β
Consumer confidence data showed continued deterioration, declining for a fifth consecutive month despite generally positive economic indicators. This divergence between complex economic data (GDP, employment) and soft sentiment measures (consumer confidence, business optimism) highlights complex psychological dynamics underlying current economic conditions. Consumers remain pessimistic about prospects despite current financial strength, potentially reflecting concerns about inflation, political uncertainty, or other factors not captured in traditional economic metrics. Β
Geopolitical tensions continued escalating, with the United States intensifying pressure on Venezuela through oil tanker seizures and potential ground campaign discussions. These developments, combined with ongoing U.S.-Iran tensions and broader Middle East instability, have amplified safe-haven demand for gold and silver whilst creating uncertainty for oil markets. The intersection of geopolitical risk and economic policy creates particularly complex conditions for risk assets, including cryptocurrencies. Β
π‘ DCW Intelligence & Insights
As 2025 draws to a close, several key themes emerge from this year's digital asset market developments. First, the dramatic divergence between the performance of cryptocurrencies and traditional safe-haven assets challenges foundational narratives about Bitcoin's role as 'digital gold.' Gold's 70% gain and silver's 140% surge dwarf Bitcoin's volatile consolidation, suggesting that institutional and retail capital seeking inflation protection or safe-haven exposure increasingly prefer proven store-of-value assets over nascent digital alternatives. Β
Second, the disconnect between on-chain activity and token prices across major Layer-1 blockchains highlights market immaturity. Solana's decentralised exchanges consistently rival or exceed the volumes of centralised exchanges, yet the SOL token price has struggled. Ethereum maintains robust network activity, yet ETH continues to face persistent selling pressure. This divergence suggests that current cryptocurrency valuations remain primarily sentiment-driven rather than fundamentally justified by network utility, presenting both risks for current holders and opportunities for long-term value investors. Β
Third, regulatory clarity is emerging as the critical catalyst for next-cycle growth. Michael Selig's appointment as CFTC Chair, the SEC's innovation exemption framework launching in January 2026, and potential spot ETF approvals for XRP and Solana represent genuine progress toward comprehensive frameworks. However, regulatory clarity alone may prove insufficient if macroeconomic conditions deteriorate or if Federal Reserve easing fails to materialise as expected. Β
Fourth, institutional adoption continues advancing despite near-term price weakness. Digital Asset Treasuries exceeding one million BTC in aggregate holdings, Trade Republic reaching a β¬12.5 billion valuation, and continued infrastructure investment all demonstrate conviction in the long-term integration of digital assets into global finance. This institutional foundation-building may prove more significant than near-term price action for cryptocurrency's ultimate trajectory. Β
Looking ahead to 2026, Galaxy Research characterises the coming year as 'one of the most difficult to forecast' due to overlapping macroeconomic risks, political uncertainties, and uneven momentum in crypto markets. Despite near-term uncertainty, the firm maintains its $250,000 Bitcoin price target by the end of 2027, believing that expanding institutional access, potential monetary easing, and demand for fiat alternatives position Bitcoin to follow gold's path as a hedge against monetary debasement. Β
β οΈ Risk Monitor
Several risk factors merit close attention as markets enter 2026: Β
Liquidity Risk: Thin holiday trading creates conditions where modest flows can trigger disproportionate price movements. This risk persists through year-end and potentially into early January until fuller market participation returns. Β
Leverage Risk: Elevated liquidations ($220 million daily) alongside rebuilding open interest ($129 billion) suggest many traders maintain inadequately margined positions. Sudden price movements could trigger cascading liquidations, amplifying initial volatility. Β
Regulatory Risk: Despite improving regulatory clarity under the Trump administration, enforcement actions continue. The recent $14 million AI-themed crypto fraud case underscores the need for persistent vigilance, whilst international developments, such as Spain's MiCA implementation, create ongoing compliance obligations. Β
Technical Risk: Bitcoin's struggle to hold $88,000 support raises concerns about potential breakdown toward $85,000 or lower. A decisive break below this level could trigger stop-loss cascades and algorithmic selling, potentially driving prices toward $80,000. Β
Sentiment Risk: Persistent extreme fear (Fear & Greed Index at 24 for 15 days) combined with continued ETF outflows suggests institutional conviction remains weak. Absent catalysts that decisively shift sentiment, range-bound trading may persist. Β
Geopolitical Risk: Escalating U.S.-Venezuela tensions, ongoing Middle East instability, and potential U.S.-Iran friction create unpredictable external shocks that could impact all risk assets, including cryptocurrencies. Β
π° Other News Stories
β’ Nomura International Wealth Management expands DIFC presence with new Dubai premises, reinforcing Middle East digital asset strategy
β’ Trade Republic reaches β¬12.5 billion valuation in β¬1.2 billion secondary share sale
β’ flatexDEGIRO hit with β¬560,000 BaFin fine for fee disclosure failures
β’ Former FTX US President raises $35M to build perpetual exchange for traditional finance assets
β’ Silver overtakes several tech giants to become the third-largest global asset by market capitalisation
β’ VanEck forecasts a dominant Bitcoin rebound amid global liquidity shift in 2026
π Looking Ahead - January 2026
Critical Events and Catalysts:
π Thursday, December 26th: $28 billion Bitcoin and Ethereum options expiration, the most significant in Deribit's history
π December 31st: Year-end institutional portfolio rebalancing, potential technical price pressures
π Monday, January 13th, 2026: December 2025 CPI data release, critical inflation reading
βοΈ January 2026: SEC innovation exemption framework launches, regulatory relief for crypto projects
π¦ Q1 2026: CFTC comprehensive crypto framework delivery, FDIC stablecoin requirements
π February 2nd, 2026: Brazil Banco Central crypto authorisation regime implementation
ππ° February-April 2026: Hong Kong insurance framework public consultation
π¬π§πΊπΈ March 2026: UK-U.S. Transatlantic Taskforce recommendations on cross-border regulation
π Early 2026: U.S. Senate crypto market structure legislation, potential CFTC spot market authority
Strategic Positioning:
Galaxy Research characterises 2026 as 'one of the most difficult years to forecast' due to overlapping macroeconomic risks, political uncertainties, and uneven momentum in the crypto market. Despite near-term uncertainty, the firm maintains a $250,000 Bitcoin price target by end-2027, believing that expanding institutional access, potential monetary easing, and demand for fiat alternatives position Bitcoin to follow gold's path as a hedge against monetary debasement. The cleaner market structure following Q4 2025 deleveraging, combined with regulatory clarity emerging through Q1 2026, creates conditions for the next bull phase. However, timing remains uncertain given multiple crosscurrents affecting risk assets broadly. Β
βΉοΈ About The Digital Commonwealth
The Digital Commonwealth Limited (DCW) is an independent industry organisation representing AI, Blockchain, DePIN, Digital Assets, ScienceTech, and Web3 sectors across our Community. Through strategic initiatives, including the Mansion House Summit Series, DCW Weekly Roundup research, DCW Cover insurance services, DCW Frontier Focus newsletter, and comprehensive advisory functions, we drive innovation, education, and collaboration across the digital economy ecosystem.
DCW's mission encompasses facilitating dialogue between industry stakeholders, policymakers, and regulators whilst providing members with cutting-edge research, networking opportunities, and market intelligence. Our events bring together leading voices from traditional finance, technology innovation, and regulatory bodies to advance thoughtful frameworks supporting responsible digital asset adoption. Through DCW Cover, we address the critical insurance needs of digital economy participants, whilst our research publications provide authoritative analysis of regulatory developments, market trends, and technological innovation shaping the future of finance.
π§ Contact Information
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β οΈ Disclaimer
This briefing is provided for informational purposes only and does not constitute investment advice, financial advice, trading advice, or any other sort of advice. The Digital Commonwealth Limited does not recommend that any cryptocurrency or digital asset be bought, sold, or held by you. Conduct your own due diligence and consult your financial adviser before making any investment decisions. Past performance is not indicative of future results. The information contained in this briefing has been compiled from sources believed to be reliable. Still, DCW makes no representation or warranty, express or implied, as to its accuracy, completeness, or correctness.
EAJW Β© 2025 The Digital Commonwealth Limited. All rights reserved.
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