Crypto Markets Remain Weak as Bitcoin Retraces Gains and Altcoins Decline
Crypto markets struggled on Tuesday, with Bitcoin giving back last week’s gains and altcoins posting further losses amid persistent investor caution.
Bitcoin traded near $87,000, down from last week’s high of $92,350, as hopes for a December “Santa rally” faded. The market remains in “extreme fear” following Monday’s sell-off, which has weighed on investor sentiment.
Altcoins underperformed, with several tokens falling more than 5% in 24 hours, led by privacy coins. Bitcoin has retraced nearly the entire Nov. 21–28 rally, underperforming U.S. equities; the Nasdaq Composite Index rose 6.6% during the same period.
Futures markets show continued outflows for BTC, ETH, XRP, and SOL, with open interest declining up to 6% over 24 hours. Bitcoin’s 90-day annualized basis has dropped to 4–5%, while Ether’s basis is near 3–4%. Bitcoin’s 30-day implied volatility (BVIV) is rising relative to Wall Street’s VIX, signaling heightened uncertainty. The ETH-BTC volatility spread narrowed to 21.50, the tightest since May, suggesting more turbulence ahead.
Options activity shows sustained put skews, with block trades favoring put spreads and calendar call diagonal spreads for BTC, while ETH traders targeted risk reversals and put spreads.
Among altcoins, ETH and XRP fell roughly 0.6%, while Bitcoin gained 0.75%. Privacy coins led losses: Zcash (ZEC) dropped 8%, Monero (XMR) and Dash (DASH) lost 5–6%, indicating the privacy coin rally may have been short-lived.
The altcoin season indicator remains low at 24/100, highlighting a preference for Bitcoin and select yield-generating DeFi tokens. SKY (formerly MKR) rose 6.7% after announcing token buybacks, supported by growing interest in USDS (formerly DAI), now with a $9.5 billion market cap and 4.5% staking yield.
