Bitcoin and Ethereum kicked off December on a weak footing as markets faced renewed volatility, pressured by risk-off sentiment and lingering concerns over liquidity in the digital-asset ecosystem.
Bitcoin slipped as much as 4.3%, falling below US$88,000, while Ethereum dropped nearly 6% to trade under US$2,900. The pullback underscores a shaky start to the month after November’s sharp retracement.
The declines come amid heightened unease following a liquidity scare linked to a major decentralised finance platform, which sent ripples across the broader crypto market. The episode has amplified caution among traders already contending with shifting macroeconomic conditions.
Market sentiment remains fragile as global investors reassess expectations of support from monetary-policy adjustments. Analysts note that fading hopes of near-term stimulus, coupled with a broader “risk-off” tone across financial markets, has weighed on digital assets.
Still, some strategists argue that the scheduled end of the US Federal Reserve’s quantitative tightening programme on Dec 1 could offer a stabilising backdrop for Bitcoin, potentially marking an inflection point if liquidity conditions improve.
Ethereum, despite its slide, continues to hover near a key multi-year support zone around US$2,850, a level that traders are watching closely for signs of resilience. Valuation models for Ethereum still signal upside potential, though meaningful recovery is likely to hinge on a broader pickup in market appetite.
In the near term, traders are eyeing whether Bitcoin can hold the US$88,000-US$90,000 support band and whether Ethereum demand strengthens within the US$2,850-US$3,000 range. Both levels are increasingly seen as critical to preventing deeper pullbacks.
With macro signals mixed and crypto-specific risks resurfacing, analysts expect a volatile start to December, though pockets of cautious optimism remain should liquidity conditions improve.
