Christmas 'Sparkling Rally'... Bitcoin Returns to $95,000 [Bitcoin Now]

Once Nearing $100,000... Retreats Close to 5%
Ethereum, Solana, and Other Altcoins Show Similar Trends
Liquidity Shrinks Year-End... US Long-Term Treasury Yields Soar

In the fourth week of December, the price of Bitcoin, the leading cryptocurrency in the virtual asset market, is fluctuating between $95,000 and $96,000. On Christmas Day, it nearly reached the $100,000 mark again at $99,900 but dropped nearly 5% in a single day, falling back to around $95,000. The liquidity has decreased due to reduced trading volume caused by the extended year-end holidays, and the surge in the 10-year U.S. Treasury yield is also believed to be dampening investor sentiment in virtual assets, similar to the stock market.

According to the global virtual asset market tracking site CoinMarketCap, as of 7:15 PM on the 29th, Bitcoin is trading at $95,009.06, up 0.63% from the previous session. Compared to a week ago, it has dropped 1.99%, and compared to a month ago, it has fallen 1.70%. The year-over-year increase stands at 122.38%.

Bitcoin's price started at around $97,000 on the 23rd and experienced fluctuations. From Christmas Day on the 25th to the 26th, it rose to as high as $99,699 but soon reversed downward. On the 29th, it retreated to $95,000, with an intraday low of $94,226.57, temporarily dipping below $95,000. Altcoins (virtual assets other than Bitcoin) such as Ethereum, Solana, XRP, and Cardano (ADA) also recorded declines of 4-7%.

On the 24th, a day before Christmas, a citizen visiting Myeongdong Cathedral in Jung-gu, Seoul, is praying to celebrate the birth of Baby Jesus. Photo by Jo Yong-jun

Forbes diagnosed that the recent increased volatility in Bitcoin prices is influenced by the extended year-end holidays. Forbes reported that Tim Eneking, managing partner at Prasalion, noted in an email, "This year, Christmas and New Year's fall exactly two weeks apart, resulting in longer-than-expected holidays and a greater reduction in market trading." Alex Lin, co-founder and managing partner of the virtual asset venture capital (VC) firm Repose, also stated, "Low trading activity during this period is a common phenomenon."

The virtual asset specialist CoinDesk suggested the possibility of a shift in the Bitcoin market trend. CoinDesk pointed out, "Although Bitcoin still shows more than double the returns compared to the beginning of the year, one overlooked aspect during last week's decline is that the 'tailwind' provided by the low-interest-rate environment may have turned into a 'headwind.'"

A major concern is long-term interest rates. Recently, the yield on the 10-year U.S. Treasury bond surpassed 4.6%. On the 28th (local time), the 10-year U.S. Treasury yield rose more than 11 basis points (1 bp = 0.01 percentage points) from the previous day to 4.631%, marking the highest level since May. As a result, the three major indices of the New York Stock Exchange ended their Santa rally early and turned downward. Typically, rising long-term Treasury yields are driven by falling bond prices and rising expected inflation. High expected inflation means either ▲the market anticipates future price increases or ▲the U.S. Federal Reserve (Fed) is expected to maintain higher interest rates for a longer period.

CoinDesk cited macroeconomic analyst Jim Bianco, who pointed out, "It is almost unprecedented in modern monetary history for long-term rates to rise sharply after the Fed cuts rates." Jim Bianco said, "The more the Fed continues to mention rate cuts in 2025, the more the bond market will continue to show rising yields (falling bond prices). If the Fed does not retract its rate cut statements, bond yields will rise as much as necessary to curb inflation, eventually reaching levels that pressure the economy."

According to virtual asset data provider Alternative, the Fear & Greed Index, which measures investor sentiment, stands at 73 (Greed) as of this date. This is the same level as the previous week's 73 (Greed). Alternative's Fear & Greed Index ranges from 0, indicating extreme fear and pessimism about investing, to 100, indicating strong optimism.