BTC and ETH Slide as Global Crypto Tax Rules and Major XRP Unlock Hit Market

I. Crypto Market Overview

Key Takeaways

Macro Environment

The UK and over 40 countries have enforced new crypto tax reporting rules, increasing global transparency. The US Senate will review the Responsible Financial Innovation Act, potentially boosting institutional crypto adoption. The US Dollar Index surged, tightening global liquidity and pressuring crypto prices.

Crypto Market

The crypto market saw broad declines over the past 12 hours, with BTC down 4.43% to $97,474 and ETH falling 9.27% to $3,144. Altcoins also dropped, led by FIL (-6.88%), PUMP (-8.03%), while STORY bucked the trend with a 0.32% gain. Downward pressure was driven by weak risk sentiment and ETF outflows.

Today's Outlook

Ripple unlocked 1 billion XRP from escrow, potentially increasing XRP market volatility. The People’s Bank of China began paying interest on digital yuan wallets, spurring $188 million into CBDC-related stocks. Peru released its latest CPI data, impacting regional risk sentiment.

Fear and Greed Index

62.00% Annual Percentile

32 Fear

Total Crypto Market Cap

$2.97T

0.91%

Total Market Trading Volume

$77.04B

11.20%

Altcoin Season Index

75.00%

Quarterly Percentile

21 / 100

Total Futures Market Open Interest

3.00B

14.55%

Futures

722.59B

0.79%

Perpetuals

II. Industry Updates

Macro-economic Policies

The UK and over 40 countries have begun enforcing new crypto tax reporting rules under CARF, increasing transparency and potentially impacting global crypto liquidity and cross-border DeFi flows.

Pakistan's CPI inflation slowed to 5.6% year-on-year in December, supporting monetary easing expectations and potentially increasing risk appetite for CRYPTO assets in emerging markets.

Economists forecast Turkey's December CPI to rise 0.96%, with annual inflation moderating to 31%. Easing inflation may support lira stability and influence local crypto demand.

The average US 30-year mortgage rate fell to 6.15%, its lowest in 2025, reflecting looser financial conditions that could support risk assets, including Bitcoin and DEFI lending activity.

The US Dollar Index (DXY) surged today, strengthening the dollar and tightening global liquidity, which may pressure crypto prices and reduce capital inflows into DeFi and NFT markets.

Cryptocurrency Regulatory Trends

The UK has begun enforcing the OECD's Cryptoasset Reporting Framework (CARF) as of January 1, 2026, requiring exchanges to report user transaction data to HMRC, increasing compliance pressure and transparency for UK crypto users.

South Korea's FIU fined crypto exchange Korbit KRW 2.73 billion for anti-money laundering violations, signaling stricter regulatory oversight and potential increased compliance costs for local exchanges.

The US Senate is set to review the Responsible Financial Innovation Act in January 2026, aiming to clarify digital asset regulation and potentially boost institutional adoption if passed.

Coinbase's Head of Research predicts that clearer global regulations and shorter ETF approval cycles in 2026 will accelerate crypto adoption, supporting market growth and institutional participation.

Prediction markets are facing regulatory scrutiny in 2026, with platforms like Kalshi and Polymarket under investigation as unlicensed sportsbooks, which may impact the growth and legitimacy of crypto-based prediction markets.

STORY (STORY): STORY saw a 0.32% 24h price increase, driven by renewed market interest in AI and tokenization narratives, with institutional adoption and real-world asset integration highlighted as key 2026 growth drivers.

Filecoin (FIL): Filecoin price rose 0.24% in the last 24h to $1.3, with trading volume at $93.49M. The move is supported by over 100 teams testing its Onchain Cloud and recent protocol upgrades improving storage efficiency.

PUMP.fun (PUMP): Despite recent whale capitulation, Pump.fun aggressively accumulated tokens, recycling $225M+ in daily revenue into buybacks. Bullish pattern formation and high on-chain activity signal strong short-term positioning.

Smart Money Movements

Strategy acquired 10,645 BTC for $980 million during a market downturn, leveraging equity markets and reserves to expand its Bitcoin holdings.

Justin Sun purchased 13.29 million LIT tokens for $33 million, representing 1.33% of total supply and 5.32% of circulating supply.

A whale transferred 3,892 BTC worth $341 million to Coinbase Institutional, signaling a major institutional move in the Bitcoin market.

Tether acquired 8,888 BTC for $779 million in Q4 2025, increasing its Bitcoin reserves as part of its ongoing diversification strategy.

A new wallet withdrew 5,798 ETH valued at $17.24 million from Kraken, highlighting significant on-chain Ethereum movement at the start of 2026.

Events to Watch

Jan 1 (Thu)

Ripple unlocks 1 billion XRP from escrow; Peru releases CPI data; People's Bank of China starts paying interest on digital yuan wallets.

Jan 2 (Fri)

Voting ends for MRC-164 on Mars Protocol; MiniDOGE launches DEX 2.0 testnet.

Jan 5 (Mon)

THETA (THETA) governance proposal for TDROP 2.0 goes live.

Jan 6 (Tue)

US Nonfarm Payrolls and unemployment rate released; Hyperliquid unlocks 1.2 million tokens; 12.4 million HYPE tokens unlocked for core contributors.

Jan 7 (Wed)

Ethereum (ETH) BPO hard fork scheduled; Stellar (XLM) launches Protocol X-Ray testnet; ISM Services PMI data released.

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