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Crypto Liquidity Tightens Ahead of Holidays: Bitcoin and Altcoins Under Pressure
Crypto Market Liquidity – As the holiday season approaches, the cryptocurrency market is showing signs of tightening liquidity, according to recent on-chain analytics from CryptoQuant. A key measure of capital inflows—the 60-day market cap change of Tether’s USDT—has dropped sharply from $15.38 billion on November 1 to just $4.83 billion this past Monday. This slowdown signals that the market may be entering a typical low-volume, low-liquidity period common around Christmas.
Stablecoin Issuance Slows, Capital Stays Cautious
Yaroslav Patsira, Fractional Director at CEX.IO, highlighted that stablecoin supply has remained largely stuck between $285–$290 billion, with occasional minor declines for USDT. He noted that while funds remain in the ecosystem, they are not being deployed aggressively. Stablecoin exchange reserves—a measure of readily deployable capital—recently hit an all-time high of $80 billion, dipped 11% during Bitcoin’s rally to $94,000, and have since seen a modest recovery.
“Dry powder exists, but capital is cautious, waiting for lower prices or rotating short-term without significant commitment,” Patsira said, suggesting that these conditions cap potential market gains.
Bitcoin Faces Liquidity Ceiling
For Bitcoin, liquidity remains relatively resilient but weakening, with upside limited without renewed ETF demand or stablecoin expansion. Analysts expect BTC to trade between its “true mean” of around $81,000 and the short-term holder cost basis near $102,000. A breakout above this cost basis could trigger a surge toward new highs, while failure to hold support at the mean may lead to bearish momentum, reminiscent of early 2022.
Altcoins Even More Sensitive
Other altcoins, including Ethereum, are more vulnerable to the liquidity squeeze, relying heavily on capital rotation and risk-on sentiment. Prediction market Myriad shows only a 23% chance of an altseason in Q1 2026.
Despite the cautious environment, Myriad users remain bullish on Bitcoin, assigning a 64% probability to BTC retesting $100,000 rather than falling to $69,000.
