Crypto Market Pulse - December 16, 2025

LAST WEEK RECAP:

The main focus last week was the Fed’s interest rate decision, where they cut interest rates by 25 bps, lowering them to 3.75% and the interest paid on reserve balances to 3.65%. The current target range for federal funds is now 3.50% - 3.75%. As this seemed to have already been priced in, focus was mostly on the projections for next year, with the Fed’s updated projections showing a slightly more optimistic outlook. The projections still aim for about 2% growth, 4% unemployment, 2% inflation, and a 3% policy rate over the medium term. Overall, the Fed currently has an easing bias with strong dependence on data. The outlook supports stable growth below trend and gradual policy easing, which bodes well for risk assets like crypto.

In crypto, during last week, the flows were unpredictable but ended positively, with around $287 million in net inflows overall. Strong inflows on December 9 and 10 totaled over $375 million, which more than covered the outflows that occurred on December 8th and 11th. Trading activity was steady, with daily volumes ranging from about $3.1 billion to $4.3 billion. Total net assets were generally stable, fluctuating between $118 billion and $122 billion by the end of the week. Overall, the data indicate strong investor interest, even with daily changes in flows. In regard to regulation, the CFTC approved Bitcoin, Ether, and USDC for use as collateral in derivatives markets, and this change will improve capital efficiency and make it easier for institutions to participate. Additionally, Ripple, Circle, and BitGo received conditional approval for U.S. banking charters, and this may signal greater regulatory acceptance.

Looking ahead to this week, key data points will include retail sales, which will offer insight into the strength of consumer spending, non-farm payrolls, initial jobless claims, and the unemployment rate, which are central to assessing the labor market. CPI, to be released on Thursday, will also be closely monitored for progress on inflation and implications for future monetary policy. Additionally, the Bank of Japan’s interest rate decision is also on Thursday, in which the bank already signaled hiking may be in the offing, thus markets will be watching to see if the BOJ follows up on this hawkish stance.

• Farcaster abandoned its “social-first” approach and fully pivoted to a “wallet-driven” growth model.
• Bybit announced a strategic partnership with USDC issuer Circle.
• A Binance employee has been suspended and faces legal action for allegedly using insider information for personal gain.
• BlackRock has officially filed for a staked Ethereum ETF.
• Binance Yi He's WeChat was hacked and used to push a memecoin.
• Coinbase now allows Solana DEX trading within its app, allowing users to trade tokens on Solana directly.
• Coinbase added Lighter to its asset listing roadmap.
• ETHBTC is still in a local range, though some bullish momentum is noted; SOL and AVAX are in a local range.
• Most major funding is neutral, and BTC OI is still on a daily downtrend but ranging last week.
• Total stablecoins market cap ~0.44% increase last 7 days, while last 30 days shows a ~1.84% increase.
• U.S. 10 Year Treasury Yield ~4.161% which is an increase from the previous week.

BTC WEEKLY VIEW

BTC broke above the descending trendline, but failed to follow through with a fresh upside expansion. Ideally, we would want to see the price hold above the former trendline as support and attempt another leg higher. However, overall momentum remains weak, suggesting limited upside traction for now.

ETH WEEKLY VIEW

ETH’s structure looks materially stronger than BTC's. After breaking above the descending trendline, the price has formed a potential rally base structure, suggesting constructive acceptance above the breakdown area.

ETH/BTC

ETH/BTC has been based within a key demand zone after a prolonged drawdown and is now breaking back above the range highs. Downside momentum has clearly slowed, with a higher low forming and relative strength starting to rotate back into ETH. As long as price holds above this range, ETH is likely to continue outperforming BTC on a relative basis.

TOTAL3 USD MARKET STRENGTH

TOTAL3 remains range-bound while holding above the demand zone.

TOTAL3/BTC MARKET STRENGTH

Despite the recent pullback, structure remains constructive, with price holding above prior breakout levels rather than fully retracing.

MARKET LEVERAGE RATIO

Market Leverage Ratio is consolidating within the demand zone. We need to closely monitor whether price can produce a strong upside reversal from this area, as that would signal renewed risk appetite and support a continuation move higher.

SUMMARY

• BTC has broken its descending trendline, but it lacks momentum. In contrast, ETH shows a stronger structure. It has accepted prices above previous breakdown levels and is improving in strength compared to BTC.
  
• ETH/BTC is breaking out from an important demand area, and the downside momentum is slowing. This suggests a return and likely continued outperformance if current levels hold.
  
• The broader market structure remains supportive but stuck in a range. TOTAL3 is holding demand, TOTAL3/BTC is above previous breakouts, and leverage is consolidating in a demand zone that needs to reverse upward to confirm renewed risk appetite.

Check out our latest blog: BTC Decline: A Market-Maker's View on Liquidity Stress

DISCLAIMER:

The information in this report is for information purposes only and is not to be construed as investment or financial advice. All information contained herein is not a solicitation or recommendation to buy or sell digital assets or other financial products.

This post was prepared by the Kairon Labs Trading Team.

Edited for publication by: Shirley Castro