Crypto Market Slides as BTC and ETH Lead Broad Decline Ahead of US NFP

I. Crypto Market Overview

Key Takeaways

Macro Environment

The Federal Reserve's ongoing liquidity injections and anticipated dovish leadership are boosting risk appetite and supporting crypto valuations. US regulatory clarity, including the Senate's crypto market structure bill and record stablecoin volumes, is accelerating institutional adoption. South Korea's Supreme Court ruling on crypto asset seizure highlights evolving global regulatory frameworks and potential investor risk shifts.

Crypto Market

The crypto market experienced broad declines over the past 12 hours, with BTC down 4.43% to $97,474 and ETH falling 9.27% to $3,144.86, pressured by weak risk sentiment and ETF outflows. Altcoins also dropped, led by ARB (-11.73%), FET (-12.59%), and POL (-7.48%), while XMR outperformed with a smaller 2.52% loss, benefiting from capital rotation after Zcash's developer crisis. No major sector showed gains; meme and DeFi tokens saw the steepest losses.

Today's Outlook

Today, the US Non-Farm Payrolls (NFP) and December Employment Report will be released, providing critical signals for labor market health and future Federal Reserve policy. These data points are likely to drive volatility across both traditional and crypto markets, as investors reassess risk and rate expectations.

Fear and Greed Index

8.00% Annual Percentile

43 Neutral

Total Crypto Market Cap

$3.11T

0.52%

Total Market Trading Volume

$111.90B

3.34%

Altcoin Season Index

72.73%

Quarterly Percentile

24 / 100

Total Futures Market Open Interest

2.71B

15.93%

Futures

661.75B

1.98%

Perpetuals

II. Industry Updates

Macro-economic Policies

President Trump announced a $200 billion mortgage-backed securities purchase plan to lower mortgage rates, aiming to boost housing affordability. This quantitative easing measure may increase liquidity and risk appetite in crypto markets.

Trump confirmed he has chosen the next Federal Reserve Chair, with markets expecting a candidate favoring lower interest rates. Anticipation of dovish Fed leadership could support Bitcoin and DeFi asset valuations.

The Federal Reserve initiated an $8.16 billion liquidity injection, with plans for $40–80 billion monthly, reminiscent of previous QE cycles. Increased USD liquidity historically correlates with altcoin rallies and higher DEFI TVL.

Stablecoin trading volume hit a record $33 trillion in 2025, up 72% year-on-year, driven by pro-crypto fiscal policies and the Genius Act. Enhanced stablecoin utility is fueling DeFi growth and cross-border crypto payments.

USDC surpassed USDT in transaction volume, reflecting institutional adoption and capital reuse in DeFi. This shift in stablecoin dynamics is increasing on-chain liquidity and supporting NFT and DeFi market expansion.

Cryptocurrency Regulatory Trends

The US Senate is advancing a comprehensive crypto market structure bill, aiming to clarify SEC and CFTC oversight and set clear rules for digital assets. This is expected to boost institutional adoption and reduce regulatory uncertainty.

Stablecoin trading volume hit a record $33 trillion in 2025, driven by the pro-crypto Genius Act and regulatory clarity, accelerating institutional adoption and prompting major firms to explore stablecoin issuance.

The CFTC has approved Bitnomial's regulated prediction market, marking a significant regulatory milestone and providing a compliant venue for crypto-based derivatives trading in the US.

Morgan Stanley will launch Bitcoin, Ethereum, and Solana trading on E*Trade in H1 2026, reflecting growing confidence in the US regulatory environment and likely increasing mainstream crypto adoption.

South Korea's Supreme Court has ruled that bitcoins held on exchanges can be seized under criminal law, clarifying the legal status of crypto assets and potentially impacting investor risk assessments.

Lighter (LIT): LIT surged 5% in 24h to $3.05 with $30.8M volume, driven by whale accumulation and a new buyback program, fueling strong market demand.

Polygon (POL): POL jumped 7% in 24h to $0.14 after Polygon Labs announced the Open Money Stack for cross-border stablecoin payments and neared a $125M Coinme acquisition.

Monero (XMR): XMR rose 2.7% in 24h to $454.26, reclaiming the top privacy coin spot as Zcash's developer crisis triggered capital rotation into Monero.

Smart Money Movements

BitMEX reported the collapse of a major crypto arbitrage strategy as annualized yields fell below 4%, marking a shift from previous 25%+ returns due to market saturation and increased automation.

A whale address transferred 5 million $KAITO tokens, worth $2.82 million, to Binance after previously receiving 24 million $KAITO from KAITO's multisig contract.

SharpLink Gaming staked approximately $170 million in ETH on the Linea Layer 2 network, increasing its total ETH holdings to about 864,800 ETH valued at nearly $2.7 billion.

A whale or institutional entity known as 'pension-USDT.eth' closed a 20,000 ETH short position, valued at $63.63 million, realizing a $400,000 profit.

A significant transfer of 30,000 ETH, valued at $92.8 million, was made from an unknown wallet to the Beacon Depositor, indicating ongoing large-scale Ethereum staking activity.

Events to Watch

Jan 8 (Thu)

China releases December CPI at 0.8% YoY and PPI at -2.0% YoY; US reports Trade Balance, Nonfarm Productivity, Unit Labor Costs, and Initial Jobless Claims data.

Jan 9 (Fri)

US Non-Farm Payrolls (NFP) and December Employment Report to be released, key for labor market and Fed policy outlook.

Jan 8 (Thu)

BGB token unlock of 140 million tokens; TRUMP token founder and team unlock scheduled, both may impact token liquidity.

Jan 14 (Wed)

US December CPI and Import Prices YoY data to be released, critical for inflation and market sentiment.

Jan 15 (Thu)

Sei (SEI) token unlock: 55.56M SEI (~1.05% of supply) to be released, raising dilution and price pressure concerns.

Table of Contents

I. Crypto Market Overview

Key Takeaways

Macro Environment

Crypto Market

Today's Outlook

II. Industry Updates

Macro-economic Policies

President Trump announced a $200 billion mortgage-backed securities purchase plan to lower mortgage rates, aiming to boost housing affordability. This quantitative easing measure may increase liquidity and risk appetite in crypto markets.

Trump confirmed he has chosen the next Federal Reserve Chair, with markets expecting a candidate favoring lower interest rates. Anticipation of dovish Fed leadership could support Bitcoin and DeFi asset valuations.

The Federal Reserve initiated an $8.16 billion liquidity injection, with plans for $40–80 billion monthly, reminiscent of previous QE cycles. Increased USD liquidity historically correlates with altcoin rallies and higher DEFI TVL.

Stablecoin trading volume hit a record $33 trillion in 2025, up 72% year-on-year, driven by pro-crypto fiscal policies and the Genius Act. Enhanced stablecoin utility is fueling DeFi growth and cross-border crypto payments.

USDC surpassed USDT in transaction volume, reflecting institutional adoption and capital reuse in DeFi. This shift in stablecoin dynamics is increasing on-chain liquidity and supporting NFT and DeFi market expansion.

Cryptocurrency Regulatory Trends

The US Senate is advancing a comprehensive crypto market structure bill, aiming to clarify SEC and CFTC oversight and set clear rules for digital assets. This is expected to boost institutional adoption and reduce regulatory uncertainty.

Stablecoin trading volume hit a record $33 trillion in 2025, driven by the pro-crypto Genius Act and regulatory clarity, accelerating institutional adoption and prompting major firms to explore stablecoin issuance.

The CFTC has approved Bitnomial's regulated prediction market, marking a significant regulatory milestone and providing a compliant venue for crypto-based derivatives trading in the US.

Morgan Stanley will launch Bitcoin, Ethereum, and Solana trading on E*Trade in H1 2026, reflecting growing confidence in the US regulatory environment and likely increasing mainstream crypto adoption.

South Korea's Supreme Court has ruled that bitcoins held on exchanges can be seized under criminal law, clarifying the legal status of crypto assets and potentially impacting investor risk assessments.

Trending Tokens

Lighter (LIT): LIT surged 5% in 24h to $3.05 with $30.8M volume, driven by whale accumulation and a new buyback program, fueling strong market demand.

Polygon (POL): POL jumped 7% in 24h to $0.14 after Polygon Labs announced the Open Money Stack for cross-border stablecoin payments and neared a $125M Coinme acquisition.

Monero (XMR): XMR rose 2.7% in 24h to $454.26, reclaiming the top privacy coin spot as Zcash's developer crisis triggered capital rotation into Monero.

Smart Money Movements

BitMEX reported the collapse of a major crypto arbitrage strategy as annualized yields fell below 4%, marking a shift from previous 25%+ returns due to market saturation and increased automation.

A whale address transferred 5 million $KAITO tokens, worth $2.82 million, to Binance after previously receiving 24 million $KAITO from KAITO's multisig contract.

SharpLink Gaming staked approximately $170 million in ETH on the Linea Layer 2 network, increasing its total ETH holdings to about 864,800 ETH valued at nearly $2.7 billion.

A whale or institutional entity known as 'pension-USDT.eth' closed a 20,000 ETH short position, valued at $63.63 million, realizing a $400,000 profit.

A significant transfer of 30,000 ETH, valued at $92.8 million, was made from an unknown wallet to the Beacon Depositor, indicating ongoing large-scale Ethereum staking activity.

Events to Watch

Jan 8 (Thu)

Jan 9 (Fri)

Jan 8 (Thu)

Jan 14 (Wed)

Jan 15 (Thu)

III. Phemex Market Focus

New Listings

Phemex Promotions