Market highlights
- Bitcoin started 2026 strong, making a convincing break above US$90,000.
- Ethereum’s daily transaction volume reached a record of almost 1.9 million on December 31.
- Sole Democrat U.S. SEC Commissioner Crenshaw’s term ended on January 2.
- Crypto lobbyists are concerned the market structure bill won’t pass before U.S. midterms.
- New global crypto tax-reporting rules came into force on January 1.
Markets Overview
Risk assets ended 2025 with a pullback, presumably due to low holiday trading volume and the release of the U.S. Federal Open Market Committee’s (FOMC) December 10 meeting minutes. The FOMC’s meeting minutes outlined that, while Fed officials expect further rate cuts in 2026, division remains over the frequency and size of these cuts. While the major indexes made subdued gains following the December 10 rate cut, precious metals saw sizeable gains. According to CME Group’s Fed watch tool, the likelihood of a rate cut at the Fed’s January 28 meeting is currently 18.3%.
On January 1, U.S. unemployment claims came in below forecast at 199,000. Ten- and two-year treasuries each dipped by 0.01% on the news to 4.1% and 3.4%, respectively. The remainder of the week was quiet for economic data due to New Year bank holidays.
Throughout the new week, market participants will presumably be awaiting the U.S ISM Manufacturing PMI update on Tuesday, January 6 and the U.S. non-farm employment change on Friday, January 9.
Weekly performance: S&P 500 -1%, Dow Jones -0.7%, Nasdaq -1.5%.
Looking ahead:
- U.S. ISM Manufacturing PMI - Tuesday, January 6
- U.S Non-Farm Employment Change - Friday, January 9
- U.S. Preliminary University of Michigan Consumer Sentiment - Friday, January 9
Crypto Market Sector Performance
The majority of crypto sectors saw gains this week, with the exception of privacy coins. The gains are presumably due to the turnaround in investor sentiment across the crypto market as the New Year begins. The crypto fear and greed index finished 2025 at 32 (fear) and is currently in neutral territory at 42.
Biggest gainer
- NFT applications: Pudgy Penguins (+46.6%) gained due to mindshare exceeding 300 billion views, whale buying activity, and strong derivatives metrics.
Crypto Market Sector Performance (7D)
Bitcoin (BTC)
- Opened the week at US$87,877 and rallied above US$90,000 with strong momentum for the first time since early December. The upward momentum is presumably due to recovering sentiment across crypto following a steep sell-off in Q4, plus capital moving away from TradFi assets following the U.S. capture of Venezuelan President Nicolás Maduro. Price is now trading around US$94,000 to start the new week (+7.7% 7D).
- BTC dominance ranged between 59.9% and 59% this week.
- US$512.3 million0.1Bitcoin investment products saw US$522 million of inflows this week. Short bitcoin saw outflows of US$1.8 million.
Bitcoin ended 2025 down 6%, following the October 10 flash crash and broader crypto sell off throughout Q4. The sell off saw bitcoin decline by over 30% from its October 6 all-time high of US$126,200. Quantum Economics’ Mati Greenspan summed up 2025 as, “the moment bitcoin officially started playing in Wall Street’s pond”. Macro sentiment drivers could also see bitcoin hit a new all-time high in 2026, as the asset reacts to macro developments rather than the traditional halving cycle and retail activity.
In bitcoin buying news:
- Tether bought 8,888 bitcoin throughout Q4 2025, bringing its total holdings to over 96,000 BTC. The company’s bitcoin has an average purchase price of US$87,935 per bitcoin and total BTC holdings are worth US$8.4 billion.
- Metaplanet bought 4,279 BTC throughout Q4, bringing its total holdings to 35,102 BTC, at an average purchase price of US$107,606 per bitcoin. The company’s BTC holdings are currently worth US$3 billion.
- Strategy bought 1,283 BTC, bringing its total holdings to 673,783 bitcoin with an average purchase price of US$75,026 per BTC. The company is continuing its treasury model, which centres around funding the purchase of more BTC through equity sales, whiles its USD reserve has increased to US$2.3 billion. This reserve can be used to meet dividend and interest obligations in the event of payments falling due throughout BTC pullbacks.
Ethereum (ETH)
- Opened the week at US$2,948 and broke above US$3,050 with strong momentum, presumably as crypto sentiment shows signs of recovery and recent events in Venezuela see capital seeking allocation outside TradFi assets. Ethereum is now trading around US$3,240 to start the new week (+10.4% 7D).
- Ethereum dominance hovered between 12% and 12.3% this week.
- US$119.1 millionEthereum-focused funds saw inflows of US$338 million this week.
A record 8.7 million smart contracts were deployed on Ethereum in the fourth quarter of 2025. This marks the highest quarterly total ever, underscoring strong developer engagement. Further, daily transactions on the network reached an all-time high of almost 1.9 million on December 31, 2025. The surge in contract development and transaction volume, driven by DeFi, stablecoins, real-world assets and infrastructure projects, highlights growing use of Ethereum’s execution layer even amid modest price performance. Ethereum ended 2025 down 10.9%.
In Ethereum buying news:
- BitMine added 33,000 ETH to its treasury, bringing its holdings to over 4.1 million ETH, equating to 3.4% of total supply and worth around US$12.1 billion.
Altcoins
The altcoin season index is currently at 41, which is still bitcoin season.
AI gains
- Render gained 72.7% as investor interest in artificial intelligence (AI) tokens increased. The network, which enables fast and affordable access to GPU power saw trading volume reach US$260.4 million, while its real-world adoption, such as the production of the Vegas Sphere, demonstrates Render’s commercial application.
- Artificial Superintelligence Alliance gained 37.7% as investors return to risk-on sentiment in some altcoin sectors, particularly AI.
Stacking TVL
- Stacks gained 45.8%. The layer-2 network for bitcoin smart contracts, apps and DeFi saw gains, presumably due to bitcoin’s total value locked (TVL) rising to almost US$7.2 billion, while Stacks’ TVL rose from US$116.6 million to US$129.7 million in the last week.
Top story
- Story gained 35.8%. The network that tokenises intellectual property is recovering from the lows seen in Q4 2024 as interest grows in the way creators can monetise their work while protecting their rights.
Sui-eet deal
- Sui gained 31.6%. The layer-1 network has seen recent gains due to TVL surpassing US$1.2 billion, while decentralised exchange volume for the token rose to over US$190 billion, indicating growing use of the network and strong investor interest.
Modular gains
- Celestia gained 29.8%. The modular blockchain network is the core data availability layer for over 100 rollups, while it remains a key liquidity hub for Ethereum scaling solutions. Growing investor interest in the modular blockchain narrative, coupled with strong fundamentals, such as the v4 upgrade reducing inflation from 7.2% to 5%, are presumably driving recent growth.
Crypto ETF News
Digital asset investment products saw inflows of US$582 million this week, as the New Year begins with improving sentiment.
For the year ending 31 December 2025, digital asset fund inflows reached US$47.2 billion, just under the 2024 record of US$48.7 billion. Bitcoin inflows declined to just under US$27 billion in 2025, while Ethereum, XRP and Solana saw strong growth in inflows.
Bitwise filed applications for 11 new crypto exchange-traded funds (ETFs), including Aave, Canton, Ethena, Hyperliquid, NEAR, Starknet, Sui, Bittensor, Tron, Uniswap, and ZCash. Similarly, Grayscale filed to launch a spot Bittensor ETF, following the network’s first halving event on December 14, 2025.
Other crypto news
- U.S. Securities and Exchange Commission (SEC) Commissioner Caroline Crenshaw departed the agency on January 2 after more than a decade of service. This ends her role as the agency’s sole Democratic member. Her exit leaves the U.S. SEC with an all-Republican three-commissioner panel, two members short of its five-member capacity.
- A new global crypto tax reporting regime backed by the OECD’s Crypto-Asset Reporting Framework has taken effect, requiring over 40 countries to mandate detailed transaction reporting by exchanges and share user tax information with authorities. The move aims to curb evasion and boost compliance, ending perceived tax anonymity for crypto holders.
- Crypto industry lobbies are concerned that the U.S. crypto market structure bill, the Digital Asset Market Clarity Act of 2025, may not pass the Senate before the passage of new policy stops in Q2 ahead of the 2026 midterms. Industry spokespeople cite the complicated and political nature of the bill as key reasons it may not pass, while regulatory clarity from the U.S. SEC and Commodity Futures Trading Commission (CFTC) has also reduced urgency to pass the bill. The bill was referred to the Senate Committee on Banking, Housing and Urban Affairs on September 18, 2025.
- Nasdaq-listed Cypherphunk Technologies added 56,418 Zcash (ZEC) to its treasury, spending approximately US$29 million (average purchase price of US$514 per token). The purchase reflects Cypherpunk’s thesis that undervalued privacy assets can deliver long-term gains. The company currently holds just under 1.8% of ZECs supply, and aims to accumulate 5% of ZEC’s circulating supply.
- South Korean policymakers postponed its stablecoin legislation, the Digital Asset Basic Act, to sometime in 2026. The delay is due to the need for further industry consultation, particularly around custody arrangements for stablecoin issuer’s reserve assets and whether a group of organisations should oversee stablecoin issuers prior to the bill’s approval. Providing regulatory clarity for stablecoin issuance in the country was an election promise made by South Korean President Lee Jae-myung when he was sworn into office in June 2025.
from Caleb & Brown Cryptocurrency Brokerage.
