Mid-December Crypto Review: What Stands Between Bitcoin And A Santa Rally?

This is the kind of mid-December tape that tests everyone’s patience. Bitcoin’s Price keeps hovering around the psychological $90K area, volatility has been ground down to “too quiet to trust,” and yet the crowd mood is unmistakable: people want the pre-New-Year rally, they’re positioned for it emotionally, and they’re getting increasingly jumpy every time the market doesn’t comply. The funny part is that, structurally, you can make a bull case and a bear case without changing a single candle — which is exactly why the week felt so tense. 

One of the cleaner explanations for why Bitcoin can’t seem to lift off is that a chunk of the “native” supply is actively selling the upside. The story doing the rounds is long-term holders (“OGs”) selling covered calls into ETF-led demand, which forces market makers to hedge by selling spot — meaning the more the upside is sold, the more spot supply appears synthetically at exactly the wrong time. If you’re wondering why rallies feel like they hit an invisible ceiling and then sag, that’s the hypothesis: not a lack of interest, but a very specific form of interest that monetizes chop and leans against breakouts. In plain English, some of the oldest Bitcoin is treating this range like an income product. 

Now add the second suppressant: participation. Bitfinex flagged spot volumes down sharply versus prior peaks, framing it as the kind of “lull” that can precede a bigger move.

That fits the lived feel of the week — a market that can move fast if pushed, but that isn’t generating its own momentum in the meantime. Thin spot also makes the options story more powerful: if organic spot demand is muted, even moderate hedging flows can dominate the marginal price. So, yes, a Santa rally is still possible, but it’s going to need either a clear liquidity impulse or an abrupt change in positioning; otherwise, the path of least resistance is more range, more frustration, and more headline-driven whipsaws. 

Macro didn’t exactly help the vibe, either. The “hawkish Japan” angle is back on traders’ radar, with some macro analysts explicitly tying a potential Bank of Japan hike to downside risk for Bitcoin — the familiar risk-off transmission channel, especially if it reignites funding stress or compresses global risk appetite. 

Whether that ends up being the driver or just the week’s convenient bogeyman, the point is simpler: when the market is already pinned and low-volume, it doesn’t take much macro anxiety to keep buyers cautious and sellers confident. 

Against that, the regulatory and institutional backdrop is… quietly constructive, and that contrast is part of the tension. The SEC publishing a plain-English custody and wallet guide is not a “pump headline,” but it is the sort of normalization signal TradFi pays attention to: custody risks, rehypothecation language, wallet tradeoffs — the boring plumbing that tends to show up when an agency expects more mainstream participation, not less. 

Even more telling, the same newsflow linked that investor-education tone to the SEC’s green light for DTCC to begin tokenizing traditional assets (equities, ETFs, government debt), which is basically the settlement layer of legacy finance experimenting with onchain rails under regulatory cover. Sure, that doesn’t directly translate into this week’s candle, but it does reinforce the medium-term narrative: the system is adapting around crypto rather than trying to pretend it’s going away. 

TradFi sentiment itself was a nice little drama this week — and, honestly, it captures where we are in the cycle. A Vanguard executive comparing Bitcoin to a collectible toy is dismissive on its face, but the context is the real signal: this came alongside Vanguard opening client access to crypto ETFs. So you’re watching the split-screen in real time: institutions are providing distribution even when parts of the institution still don’t like the asset. 

Altcoins, for their part, looked like a market still searching for a risk-on heartbeat. 

Solana ETFs reportedly kept logging inflows even while SOL’s price action stayed heavy — a divergence that hints at gradual product-driven accumulation without the speculative frenzy that used to spill over from memecoins into everything else. 

So can we get the pre-New-Year rally? Sure — the setup is actually compatible with it. When volatility is crushed, the next move tends to be decisive, and a break can feed on itself quickly if short-term positioning is wrong-footed. The catch is that this week gave you a fairly coherent checklist of what needs to change without calling it a checklist: spot participation has to reappear, macro has to stop scaring people at the margin, and the market probably needs some relief from the “sell the upside” options dynamic that’s been leaning on price. Until then, the most honest description of the market is that it feels like it’s pacing in front of the door: the building blocks are there, the crowd is impatient, and the lock hasn’t clicked open yet.rket probably needs some relief from the “sell the upside” options dynamic that’s been leaning on price. Until then, the most honest description of the market is that it feels like it’s pacing in front of the door: the building blocks are there, the crowd is impatient, and the lock hasn’t clicked open yet.

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Source: Mpost.io