Weekly Market Update: Expect More Turbulence

2025 began with the rallying cry “Survive ’til ’25”, but the year quickly delivered a masterclass in market whiplash! Let’s walk through some of the macro and crypto highlights…

Trump’s January inauguration ignited a surge of optimism: the most pro-crypto White House in history, talk of a U.S. Bitcoin strategic reserve, and central banks alongside sovereign funds rushing in as if it were Black Friday at the blockchain buffet. Bitcoin soared on visions of parabolic gains.

Then came the sharp reversal: Trump’s “Liberation Day” trade war – it turned out to be more TACO than actual tariff terror, but unleashed global uncertainty that has lingered in the market’s collective psyche ever since. Crypto has fought an uphill battle this year against a growing “wall of worry,” that sparked fresh capital rotation into precious metals, shattering Bitcoin’s safe-haven narrative in a sharp divergence.

Power dynamics shifted further and faster than expected: China’s military displays embarrassingly overshadowed Trump’s birthday celebrations, as BRICS expanded at record pace with new members and eager applicants. Even longtime U.S. allies began stealth dedollerisation, paying for purchases of oil and other commodities in Rubles and Yen. 

The U.S.-EU relationship widened as the Russia-Ukraine war ground unresolved towards its fourth year. As President Trump made a sustained push to consolidate America’s sphere of influence in the Western Hemisphere from desires on Greenland to the Argentinian bailout and Venezuelan “war on drug cartels.” It’s all happening across the Americas!

The U.S. Fed’s pivot to rate cuts again after a 10-month pause, coupled with whispers of QE, drove Bitcoin to new all-time highs above $126K in early October. Brazen bulls celebrated the arrival of the “banana zone,” only for it to go limp as OG whales and institutional players dumped in mass triggering a record $20B liquidation bloodbath that the crypto market is yet to recover from.

As 2025 draws to a close, hopes for a Santa rally are fading as investors are growing weary and complacent, while traders – bruised, battered, and running out of dry powder – are nearing exhaustion. The crypto bull run has effectively “run off the 4-year-cycle map” and what comes next is anyone’s guess!

Crypto’s gains in 2025 are undeniable: Stablecoins cemented their role in the global financial system with the passage of the GENIUS Act in July. And Digital Asset Treasury firms just surpassed exchange-held Bitcoin volumes, amassing over 1 million BTC which is roughly equal to Satoshi’s stash. 

The real winners of the year were the precious metals, gold up over 60% and silver over 100% and screaming warnings of storms ahead. 

Potential black swans swarm from every direction: Taiwan-China flare-ups, a grinding Russia-Ukraine war fracturing U.S.-EU ties while empowering BRICS, AI’s explosive energy demands threatening grid collapse, fragile digital systems ripe for catastrophic cyberattacks, and a Magnificent 7 bubble poised to burst into recession. Take your pick!

The forecast for 2026? Expect more turbulence. But in macro, and particularly in crypto, smooth sailing has always been a myth. 

Stay vigilant, right size your investments and don’t get liquidated.

Market sentiment is struggling to get out of: Extreme Fear

Crypto market moves: 

• Bitcoin closed the week at $88.1k before dropping further on weakening investor sentiment ahead of a big numbers week in the U.S. and Bank of Japan decision.
• Bitcoin ETF inflows have remained relatively muted for a third week in a row as overall trading volatility hits “extreme lows”, signalling a big move could be around the corner.
• The total crypto market cap has remained above $3 trillion – but only 10% of the top 100 tokens are green over the past 90 days!
• Bitcoin weekly RSI has dropped lower to 37 signally weakening momentum. 
• The Fear & Green index remains firmly beaten down in “Extreme Fear” and Google Search volume continues to bounce along the bottom!
• Bitcoin dominance is firm at 59% with just 19 of the top 100 Altcoins outperforming Bitcoin in the last 90 days. Altseason 3.0 feels like a distant dream.
• Polymarket now gives Bitcoin just a 12% chance of reclaiming the crucial $100k level before the end of the year.
• The big winner of the week is XMR (Monero) +10.3% as the privacy coin rally holds up.
• The big loser of the week is ICP (Internet Computer) -18.7% as the broader AI space gets hit with some hard selling pressure.

View all top gainers: Visit the top gainers page to find out more.

Highlights from the crypto space

The Fed delivered the widely anticipated rate cut, yet its hawkish forward guidance quickly dampened market enthusiasm and effectively dashed hopes for a Bitcoin “Santa rally.” The crypto market remains on shaky ground as Bitcoin has broken back below $90k and weary investors are running dry on hopium and potential bullish catalysts.

The Bank of Japan is widely expected to announce another rate hike, a move that could unsettle carry-trade positions and markets. Some analysts are warning that the resulting liquidity squeeze could potentially trigger another down leg in the price of Bitcoin – as evidenced by the previous three hikes.

On the other hand, Barclays warns of a prolonged calm in the crypto markets, with weak retail trading and muted price action likely persisting into 2026 as fading retail participation, declining exchange revenues, and a lack of near-term catalysts drive the slowdown. Take your pick!

Gold strongly outperformed Bitcoin in 2025, resulting in a 50% decline in the BTC-to-gold ratio.

Michael Saylor’s Strategy survived its first shake up in the Nasdaq 100 as MSCI considers excluding firms whose crypto holdings exceed 50% of total assets. Their response, to buy more Bitcoin of course.

The SEC has issued fresh guidance urging retail investors to understand the risks and options of storing digital assets – just as federal regulators advance a historic shift toward integrating crypto into the traditional banking system. Nice timing guys!

Ripple, Circle and other crypto firms have received preliminary approval for U.S. banking charters. Coinbase, Stripe-owned Bridge, and Crypto.com have also applied.

JPMorgan Chase has launched a new tokenised money-market fund for wealthy investors called My OnChain Net Yield Fund (or MONY) that’s based on the Ethereum network. Their asset-management division, which handles $4 trillion, will open the fund to minimum investment of $1 million with individuals needing $5 million in investments to qualify.

Brazil’s biggest bank Itaú is telling investors to consider putting 1% to 3% of their portfolio into Bitcoin for diversification. They get it!

Do Kwon, co-founder of Terraform Labs, was sentenced to 15 years in U.S. federal prison for “generational fraud” related to the $40 billion collapse of TerraUSD/Luna in 2022. FAFO.

Other crypto news

• South Koreans wanting to pour money into risky investment products will first have to watch a training video.

• A new mobile and web game called Trump Billionaires Club uses the TRUMP memecoin for all in-game activity.

• A dispute is erupting between the Aave decentralized autonomous organization (DAO) and Aave Labs over fees from the recently announced integration. Yikes.

• Tether made an all-cash offer to acquire Italian soccer club Juventus. But the bid was rejected by the Agnelli family because they have no intention of selling the club.

• Stripe has acquired crypto wallet startup Valora and announced a new partnership with Klarna to build a crypto wallet. Going all in on crypto!

• Russia’s largest bank Sberbank says it’s testing a range of DeFi products.

A crypto millionaire is planning to set up a “paradise on earth” on a Caribbean island. Where do we sign up?

🌎 Macro news TLDR: Japan didn’t collapse overnight

When we look at Japan we see the future of the US, only someone hit fast-forward and let the population pyramid invert.

Hard numbers: 29% of Japanese are already over 65. Fertility is 1.26 and falling; America’s is 1.62 and trending the same direction. Public debt is the highest on earth at 260% of GDP, while the Bank of Japan owns 54% of the bond market and has pinned the 10-year yield near zero for a full generation. 

The U.S. Treasury market is likely just 10-15 years behind on the same trajectory. 

In Japan, growth has averaged 0.8% annually since 1995. Real wages are lower today than in 1997. And the Nikkei only reclaimed its 1989 peak in 2024 after thirty-five lost years.

Later this month, Governor Ueda faces an impossible decision: raise rates another 25 bps and risk a bond-market revolt or pause/cut and watch the yen collapse. Either path could trigger a reckoning that the world has been postponing since 2008: the sudden recognition that three decades of debt were built on the assumption that rates-will-never-rise.

Japan’s economy is the world’s longest-running, real-time demonstration of a failed Keynesian experiment. America is simply further back on the same treadmill. 

At this point it feels almost inevitable that one day soon we’ll look back and say: Japan didn’t collapse overnight; it slowly suffocated under the weight of its own policy choices.

Economic news from the Americas

The Fed cut rates by 25 bps as expected, but hawkish guidance dampened excitement, projecting only one more cut in 2026 and sparking the most dissents (9-3) since 2018. Markets brushed it off, focusing on the $40 billion treasury bond purchase which Fed Chair Powell is calling “Reserve Management” – also known as the start of quantitative easing! 

Polymarket is now showing just 21% chance of a further rate cut in January.

The U.S. has collected more than $200 billion in new tariffs this year thanks to President Trump’s trade war, which will make a small dent on the budget deficit. The tally comes as the Supreme Court is still considering if the new tariffs are illegal.

November’s jobs report came in better than expected adding 64,000 jobs, however the delayed October report showed a reduction of 105,000 jobs and a rising unemployment rate to 4.6%.

Three companies tied to the AI infrastructure build out, Broadcom, CoreWeave and Oracle, are having a rough few days on Wall Street as investor concerns about whether the returns on investment will ever justify the level of spending taking place. 

U.S. forces seized control of a big oil tanker off the coast of Venezuela last week, claiming that it repeatedly hid its location and was carrying sanctioned oil from Iran and Venezuela.

U.S. crude oil prices fell nearly 3% yesterday to close at the lowest level since early 2021, as a looming surplus and possible peace agreement in Ukraine weigh on the market.

Over in Europe & the Middle East…

Britain’s economy shrank unexpectedly in October as consumers held back on spending ahead of the annual budget announcement. GDP fell by a further 0.1% after a 0.1% drop in output in September. The Bank of England is now likely to cut interest rates again next week to 3.75% in an attempt to jumpstart growth.

Greece completed an early repayment of €5.3bn in loans from its first Eurozone bailout programme this week, signalling a positive step in a decades-long effort to stabilise its finances.

The EU has pushed back against external pressures and decided to “indefinitely immobilise” the seized Russian sovereign assets until Moscow agrees to pay war reparations to Ukraine. Russia has responded again by calling the decision “illegal.” 

European defense companies tumbled this week as President Zelenskyy announced over the weekend that Ukraine was prepared to abandon the country’s longstanding aim of joining NATO in exchange for alternative security guarantees to protect it from Russia.

And in Asia Pacific…

The Bank of Japan is a key driver of global markets and is expected to raise rates by 25 bps to 0.75% at their meeting on Friday, the first hike in 11 months and to the highest level in 30 years. This is the one to watch!

China’s economic slowdown deepened in November as retail sales rose just 1.3% last month from a year earlier, sharply missing expectations for 2.8% growth, and slowing from 2.9% rise in the prior month. Industrial production climbed 4.8% in November from a year ago, missing expectations for a 5% jump and marking its weakest growth since August 2024. 

New Zealand’s manufacturing sector showed further expansion according to BusinessNZ, the seasonally adjusted PMI for November was 51.4 and 0.2 points higher than October, but still below the average of 52.4 since the survey began.

Wespac shocked the market last week by moving some of their longer term fixed mortgage rates up by 30 basis points shortly after the RBNZ rate cut decision, citing an increase in wholesale swap rates. 

The new Reserve Bank Governor responded by saying “financial market conditions have tightened since the November 26 decision, beyond what is implied by our central projection for the OCR.” Confirming that they will reduce regulatory capital requirements to further incentivise reduced interest rates. Merry Christmas!

That’s a wrap for this week!

Note: This is the last newsletter for this year as we’ll be taking a break over the Summer holidays – our next newsletter will be in your inbox on Wednesday 21 January 2026. 

Wishing you a very merry Christmas and prosperous new year!

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