Bitcoin dips below $80,000 as crypto ignores Asian tech rally and Fed meeting begins

Bitcoin BTC$84,459.46 slipped below $80,000 on Tuesday, dropping 0.4% since midnight UTC to near $79,700. Altcoins fell further, with ether ETH$2,490.55, the largest, losing 0.5%. The DeFi index (DFX) dropped 1.8%, the most of any CoinDesk index, a reversal from Monday, when it was the only index to gain.

U.S. stock index futures edged lower ahead of big-tech earnings later this week. Asian tech shares rallied, with South Korea’s Kospi rising 3.1%, though the advance didn’t pull crypto along with it. Oil rose, with U.S. crude approaching $102 a barrel.

The Federal Reserve begins a two-day meeting today, with an interest-rate decision on Wednesday and CME’s FedWatch tool showing around a 90% chance of no change. Traders will be looking for clues on whether another rate increase is likely before year-end. U.S. spot bitcoin ETFs took in $110 million on Monday, according to Farside Investors, ending two days of outflows.

Derivatives positioning

• Volume surge: Across crypto futures, volume rose 18% to $152 billion in 24 hours after falling yesterday, while open interest (OI) rose just 0.95%. Liquidations eased 13% to $133 million. The taker long/short ratio is 49.54% to 50.46%, so market orders were split almost evenly.
• Capital inflows on the dip: BTC and ETH fell about 1.1% over 24 hours and SOL lost 1.91%, while their futures open interest rose about 1%, 0.8% and 3.6%, respectively. Money entered as prices fell, with SOL adding the most. Funding stayed positive for all three, so longs have not left. SOL’s cumulative volume delta (CVD) ended negative, which shows market-order selling.
• SOXL reversal: Money that entered SOXL, a contract tied to a triple-leveraged semiconductor ETF, has left over the past 24 hours. Futures open interest is down 7.4% alongside an 8% gain in the perp price. The gains, therefore, look to have been fueled predominantly by unwinding of shorts. SKHYNIX, a contract tied to chipmaker SK Hynix, did the same on a smaller scale, and its funding fell to 0.0221% from 0.0516%.
• Crude funding: Funding for oil is still the only negative rate on the list, deepening to -0.0115% from -0.0077%. The move points to a persistent bias for short positions. Open interest rose 2.18% on a 0.86% price gain, so money is returning after yesterday’s outflow.
• Options flow: The most traded bitcoin options play of the past 24 hours is the $72,000 put expiring on Dec. 25. The rest of the top five by volume are all call options. BTC’s 25-delta put-call skews remain positive across tenors, indicating a bias for downside protection. Ether options display a similar sentiment.

Token talk

• Privacy coins held up better than most, with dash DASH$52.23 rising 1.8%. Zcash (ZEC) added 0.5% as co-founder Sean Bowe proposed ending the 8% share of newly created coins that funds the network’s community grants program, saying its treasury of around $125 million could cover years of spending.
• DeFi tokens gave back Monday’s gains, with aave AAVE$157.15 falling 3.6% and sky SKY$0.07611, the token behind the project formerly called MakerDAO, losing 3.9%. Aave’s DAO has not bought back tokens since April.
• AI-linked tokens fell even as Asian tech stocks rallied, with render (RENDER), the GPU computing network, and the graph GRT$0.02495, the blockchain data protocol, each losing than 2%.
• Celestia (TIA), starknet STRK$0.05642 and pump.fun PUMP$0.005148 all fell around 3%, with celestia faceing an unlock of 5.58 million TIA on Saturday, according to Tokenomist.
• CoinMarketCap’s Altcoin Season index rose to 57/100 from 53 on Monday.