Tag Archives: crypto

Tech earnings fail AI test and crypto pays the price

Tech earnings fail AI test and crypto pays the price

Asian equity markets began the session on a sombre note, weighed down by a broad-based retreat in technology stocks, a sector that has powered regional gains throughout much of the year. The sell-off reflects growing investor unease over the sustainability of artificial intelligence-driven valuations, especially as major US tech firms like Oracle and Broadcom delivered earnings outlooks that failed to meet elevated expectations.

The ripple effects from Wall Street’s Nasdaq, which dropped 1.81 per cent, have now reached Tokyo, Hong Kong, and Seoul, reinforcing the increasingly tight correlation between global tech sentiment and risk-on assets like cryptocurrencies.

Japan’s Nikkei 225 opened at 49,004.9 points, marking a decline of over one per cent from its prior close of 49,512.28. The losses were led by heavyweight tech and semiconductor-related names, with SoftBank Group plunging 7.25 per cent on concerns that its aggressive AI and venture bets may not deliver near-term returns.

In Hong Kong, the Hang Seng Index hovered around 25,405.63 points, slightly lower for the day, but the real pain came from its technology sub-index, which slid sharply as mainland and overseas investors rotated out of growth-oriented equities. Meanwhile, mainland China’s Shanghai Composite bucked the trend slightly, trading at 3,874.3586 points with a modest gain, though it too experienced earlier-week volatility as Beijing’s mixed signals on fiscal stimulus and tech regulation created uncertainty.

At the heart of this market-wide caution lies a fundamental reassessment of AI-driven capital allocation. For over two years, tech companies across Asia, from South Korea’s Samsung and SK Hynix to Taiwan’s TSMC, have poured billions into AI infrastructure, data centres, and next-generation chip development. These investments lifted stock prices to record highs, supported by narratives of an AI revolution that would reshape global productivity.

Today’s market action suggests investors are demanding more than vision; they want measurable returns. With forward earnings revisions turning negative for several key players, the market is pricing in a potential gap between ambition and profitability.

This shift in sentiment has spilled directly into the cryptocurrency market, which fell 1.64 per cent in the last 24 hours, extending a 7.17 per cent weekly decline. The linkage is no longer coincidental; it is structural. Over the past 18 months, institutional capital has increasingly treated large-cap crypto assets, particularly Bitcoin, as a satellite to the Nasdaq, especially during macro regimes dominated by liquidity expectations and risk appetite.

The 24-hour correlation between Bitcoin and the Nasdaq-100 now stands at plus 0.89, meaning the two move in near lockstep. When US tech falters, crypto follows, and today’s Nasdaq weakness is fuelled by AI scepticism, which is transmitted directly into digital asset markets.

Compounding the pressure was a significant liquidation cascade in crypto derivatives markets. In just 24 hours, Bitcoin saw US$153 million in liquidations, a 148 per cent increase from the prior day, with short positions accounting for US$79.5 million of that total. Such aggressive unwinding of leveraged positions typically occurs when prices breach key technical levels, triggering stop-losses and margin calls in a self-reinforcing spiral.

With total open interest across crypto derivatives at US$776 billion, the ecosystem remains highly sensitive to volatility shocks. The 7-day Relative Strength Index for Bitcoin has plunged to 15.4, signalling extreme oversold conditions, a level that historically precedes short-term bounces. Without a catalyst, oversold does not automatically mean reversal.

Further undermining confidence is the curious paradox surrounding XRP. Despite the recent launch of an XRP exchange-traded fund that has drawn US$1 billion in inflows since November, the token itself trades 47 per cent below its all-time high. This disconnect between institutional adoption and price performance has sown doubt among retail traders and algorithmic strategies alike.

If a regulated ETF with billion-dollar backing cannot reignite momentum in a top-five asset, the broader altcoin market may lack the firepower for a meaningful recovery. As a result, Bitcoin dominance has climbed to 59.2 per cent, reflecting a flight to relative safety within an already volatile asset class.

Crypto’s traditional role as a hedge has also diminished. Its 24-hour correlation with gold has turned negative at minus 0.35, indicating that in the current environment, it behaves not as a store of value but as a high-beta tech proxy. This shift matters because it means that during macro stress, such as uncertainty around central bank policy, crypto no longer offers diversification benefits. Instead, it amplifies risk. Traders now view it through the same lens as semiconductor stocks or cloud software equities, a leveraged bet on future innovation with limited near-term cash flows.

Looking ahead, all eyes in Asia will turn to the Bank of Japan’s policy decision later today. While Japan has maintained ultra-loose monetary policy longer than any other major economy, recent inflation data and yen weakness have sparked speculation that a rate hike, however modest, could be on the table. Such a move would tighten financial conditions in the region, further pressuring high-duration assets like tech stocks and crypto. Even the mere acknowledgement of a policy shift could trigger another leg down in risk markets.

In this context, the path for Bitcoin and Asian tech hinges less on fundamentals and more on macro liquidity. The market is no longer rewarding vision alone. It requires evidence that AI investments will translate into earnings, that crypto ETFs will drive sustainable demand, and that central banks will not abruptly withdraw the punchbowl. Until those questions are answered, volatility will persist, and the correlation between the Nasdaq and crypto will remain a dominant force shaping price action.

The current oversold RSI reading may hint at a tactical bounce, but without a shift in narrative or policy, any relief rally could prove fleeting. The era of unquestioning faith in AI-driven growth appears to be giving way to a more discerning, earnings-focused regime, one that will separate speculative narratives from enduring value.

 

Source: https://e27.co/tech-earnings-fail-ai-test-and-crypto-pays-the-price-20251218/

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

Crypto’s fragile comeback: Technical relief meets macro uncertainty

Crypto’s fragile comeback: Technical relief meets macro uncertainty

The recent interplay between macroeconomic signals, regulatory shifts, and technical dynamics has placed the crypto market in a precarious but intriguing position. While traditional financial markets grapple with mixed labour data and shifting rate expectations, digital assets have staged a modest recovery, buoyed not by exuberance but by relief, tactical positioning, and emerging institutional frameworks. The 0.84 per cent rise in the crypto market over the past 24 hours appears deceptively simple, yet it encapsulates a much broader narrative about resilience amid structural uncertainty.

This rebound lies a classic technical phenomenon: the oversold bounce. The market’s RSI14 dipped to 31, flirting with the lower boundary of neutral territory and signalling that selling pressure had reached a temporary extreme. This condition attracted opportunistic traders, evidenced by a sharp 23 per cent surge in derivatives volume as participants sought to capitalise on discounted entry points. However, this surge came with a caveat. Open interest in perpetual and futures markets declined by 6.7 per cent, suggesting that while short-term speculators entered the fray, longer-term holders and leveraged participants remained cautious.

The MACD histogram, registering at a negative US$389 million, further underscored the absence of strong momentum behind the move up. Meanwhile, Bitcoin dominance held steady at 58.8 per cent, indicating that capital remained concentrated in the perceived safety of the flagship asset rather than rotating into riskier altcoins. This defensive posture reflects a market that is not yet convinced the worst is over, merely that it may have priced in the near-term pessimism.

Crucially, this technical bounce coincided with a notable policy development that may carry longer-term implications. Canada’s announcement of a forthcoming stablecoin regulatory framework for 2026 represents a rare moment of constructive clarity in an otherwise turbulent regulatory landscape.

Bank of Canada Governor Tiff Macklem emphasised that only stablecoins pegged one-to-one to central bank currencies and backed by high-quality liquid assets like Treasury bills would qualify as “good money.” This stance, while stringent, provides a clear benchmark for issuers and reassures institutions that Canada seeks to integrate stablecoins into its financial infrastructure rather than shun them outright.

In a global context where regulatory ambiguity has often stifled innovation, Canada’s approach, complemented by its Real-Time Rail payments system and open banking initiatives, positions the country as an emerging hub for compliant digital finance. This contrasts sharply with the United States, where legislative delays continue to weigh on sentiment.

While the US remains the largest market for crypto ETFs, its policy inertia creates a vacuum that other jurisdictions are beginning to fill. Canada’s proactive stance, though modest in immediate market impact, offers a glimpse of a more stable institutional pathway forward, particularly for payment-oriented stablecoins that could bridge traditional finance and Web3 ecosystems.

Optimism remains tempered by the realities of institutional flows and on-chain behaviour. Grayscale’s bullish outlook for Bitcoin in 2026, predicting new all-time highs, provides a compelling long-term thesis rooted in macro cycles and halving dynamics. This vision clashes with the short-term data emerging from ETF markets, which recorded US$1.11 billion in weekly outflows.

These outflows reflect investor caution in the face of rising macro uncertainty, including the mixed US jobs report that showed only 64,000 jobs added in November, barely above expectations, but a concerning rise in unemployment to 4.6 per cent, a four-year high. Such data complicates the Federal Reserve’s decision-making, diminishing hopes for aggressive rate cuts in early 2025 and indirectly pressuring risk assets.

In this environment, even bullish institutional narratives struggle to overcome near-term liquidity concerns. The pressure extended beyond Bitcoin, with Ethereum experiencing sharp derivatives liquidations after a single whale incurred a US$54 million unrealised loss on leveraged long positions. This episode highlights the fragility of leveraged exposure in times of volatility and the cascading effects that can ripple through the market when large positions unwind unexpectedly.

The broader macro backdrop further contextualises crypto’s cautious rebound. Asian equities declined broadly, with MSCI’s Asia-Pacific ex-Japan index falling 1.3 per cent to a three-week low. Japan’s Nikkei dropped 1.6 per cent ahead of a widely anticipated rate hike by the Bank of Japan, signalling a shift away from decades of ultra-loose monetary policy. Simultaneously, oil prices slumped below US$60 per barrel, their weakest level since May, driven by oversupply fears and speculation about potential peace talks between Russia and Ukraine.

The US dollar weakened across major currencies following the ambiguous jobs data, suggesting markets are recalibrating expectations for global monetary policy divergence. In such a landscape, crypto’s modest gain appears not as a flight to risk but as a relative stabilisation after excessive pessimism.

Looking ahead, the sustainability of this rebound hinges on several converging factors. Technically, a decisive move above the 7-day simple moving average at US$3.03 trillion in total market capitalisation would signal growing confidence. More critically, Bitcoin must reclaim the US$87,000 level, a psychological and liquidity-rich threshold tied to US$20.6 million in potential long liquidations.

A break above this mark could trigger a wave of short-covering and renewed institutional interest, especially if macro conditions begin to favour risk assets once more. The Fear and Greed Index remains at 25, deep in “fear” territory, suggesting that sentiment has not yet turned, but also that there is room for improvement should catalysts materialise.

Ultimately, the current rally is not a declaration of a new bull market but a measured recalibration. It emerges from a confluence of short-term technical exhaustion, selective regulatory progress in jurisdictions like Canada, and persistent institutional conviction in crypto’s long-term narrative. However, it operates within a fragile ecosystem marked by declining year-over-year trading volume, down 11.7 per cent, defensive capital rotation, and ongoing macro headwinds.

The market’s next move will depend less on isolated data points and more on whether these disparate forces can align, whether policy clarity can offset ETF outflows, whether macro easing can return, and whether on-chain leverage can stabilise. Until then, traders and investors alike remain in a holding pattern, watching closely for the first signs of durable conviction.

 

Source: https://e27.co/cryptos-fragile-comeback-technical-relief-meets-macro-uncertainty-20251217/

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j

Crypto faces triple threat: Senate stall, macro jitters, and technical breakdown

Crypto faces triple threat: Senate stall, macro jitters, and technical breakdown

The crypto market’s stumble reflects a confluence of structural, technical, and macro forces that have converged with unusual intensity over the past 24 to 48 hours. This pullback lies a triple threat: regulatory inertia in Washington, a violent unwind of speculative leverage across derivatives markets, and the fracturing of key technical support levels that have historically anchored bullish sentiment.

Together, these dynamics have amplified risk-off behaviour across digital assets, pushing the broader market into a 4.12 per cent decline in just one day and extending weekly losses to nearly five per cent. This correction is not merely a knee-jerk reaction to volatility but a manifestation of deeper vulnerabilities that have built up during the recent rally toward all-time highs.

The most immediate catalyst stems from Washington, where the US Senate Banking Committee formally postponed any vote on comprehensive crypto market structure legislation until early 2026. This deferral effectively kills any chance of meaningful regulatory clarity before the next presidential term, leaving the industry in a state of prolonged ambiguity. For years, market participants have pinned hopes on a legislative framework that would delineate jurisdictional boundaries between the SEC and CFTC, provide safe harbours for token issuers, and establish clear rules for spot and derivatives markets.

The delay dashes those expectations and reinforces a narrative of institutional caution. Evidence of this caution surfaced immediately in ETF flows, where US spot Bitcoin ETFs recorded US$158.8 million in net outflows during December, signalling a retreat by institutional allocators. Even more telling was the US$19.4 million outflow from Ethereum ETFs on December 15 alone, led by ETHA, which underscores waning confidence in the second-largest digital asset amid both regulatory headwinds and technical deterioration.

Compounding this policy vacuum is a dramatic deleveraging event across the crypto derivatives landscape. Total derivatives volume exploded by 59 per cent to US$330.57 trillion, with perpetual swaps alone surging 166 per cent over 24 hours, a clear sign of speculative fever. But as price momentum stalled, that leverage turned toxic. Bitcoin liquidations spiked to US$174.7 million, a 58 per cent increase from the prior day, with long positions bearing 94 per cent of those losses.

Ethereum fared no better, suffering US$164.5 million in long-side liquidations as its price tumbled 6.65 per cent. The presence of extreme leverage ratios, with some platforms still offering up to 1001x, is particularly destabilising in this environment, as even minor price movements can trigger cascading margin calls. With open interest still sitting at an elevated US$789 billion, the market remains vulnerable to further forced selling should the downward momentum persist, especially if macro data or external catalysts fail to restore confidence.

Technically, the situation has deteriorated to a critical juncture. Bitcoin now hovers dangerously close to its two-year simple moving average at US$82,800, a level that has historically marked the onset of prolonged bear markets when breached on a weekly close. The broader crypto market capitalisation has slipped below its 30-day moving average of US$3.06 trillion, and the 14-day Relative Strength Index for the aggregate market sits at 36.91, edging toward oversold but still lacking a clear reversal signal.

Perhaps most concerning is the position of long-term holders, specifically the cohort that acquired coins between six and 12 months ago. This group now faces unrealised losses of 11.6 per cent, a threshold that often prompts distribution as conviction wanes. Ethereum’s own technical picture has darkened further with a decisive break below its 200-week moving average near US$2,800, a long-standing pillar of support that, once lost, tends to accelerate downside momentum in multi-month cycles.

Macro crosscurrents have not provided much relief. Equity markets, particularly US tech, are showing signs of fatigue as investors brace for a dense cluster of economic data, headlined by today’s November jobs report. Consensus expectations call for a modest 50,000 payroll gain, but the range is unusually wide, spanning from a contraction of 20,000 jobs to an addition of 127,000. More significantly, the unemployment rate is projected to tick up to 4.5 per cent, a move that could complicate the Federal Reserve’s narrative around labour market resilience.

While a softer report might revive hopes for early 2025 rate cuts, the market remains sceptical given recent hawkish commentary from Fed officials. This uncertainty has kept the VIX anchored in the mid-teens with elevated skew, reflecting demand for downside protection. Meanwhile, the strong correlation between crypto and the Nasdaq, measured at plus 0.89 over the past 24 hours, means that any equity market weakness is likely to spill over into digital assets.

Geopolitical developments add another layer of complexity. US negotiators have reportedly offered Ukraine security guarantees resembling NATO’s Article 5 as part of a potential peace framework, a move that has dampened safe-haven demand for gold and crude oil. Ukrainian peace hopes, combined with Trump’s assertion that a settlement is closer than ever, have triggered a selloff in commodities and shifted risk appetite toward equities and away from defensive assets.

However, this optimism remains fragile, especially with central bank meetings looming from both the European Central Bank and the Bank of England. The pound has softened ahead of the BoE decision, while the yen has firmed just below 155 against the dollar, suggesting that currency markets are also navigating a delicate balance between monetary policy divergence and geopolitical risk.

Against this backdrop, the crypto market finds itself at an inflexion point. The confluence of regulatory delay, leverage collapse, and technical fragility has created a self-reinforcing feedback loop that could deepen losses unless offset by countervailing forces. One such force could come from institutional accumulation.

MicroStrategy’s recent US$980 million Bitcoin purchase demonstrates that some large players view this dip as a strategic entry opportunity. If other corporate treasuries or ETF sponsors follow suit, particularly if today’s jobs data supports a dovish pivot, the market could stabilise above the US$82,800 threshold. Conversely, if payroll numbers come in hot and reinforce the Fed’s higher-for-longer stance, risk assets across the board may face renewed pressure, dragging crypto lower alongside tech equities.

I believe today’s decline is not an isolated event but a symptom of deeper structural imbalances. The next 48 hours, anchored by the US jobs report and central bank commentary, will likely determine whether this pullback evolves into a deeper correction or sets the stage for another leg higher on renewed institutional demand.

 

Source: https://e27.co/crypto-faces-triple-threat-senate-stall-macro-jitters-and-technical-breakdown-20251216/

 

 

Anndy Lian is an early blockchain adopter and experienced serial entrepreneur who is known for his work in the government sector. He is a best selling book author- “NFT: From Zero to Hero” and “Blockchain Revolution 2030”.

Currently, he is appointed as the Chief Digital Advisor at Mongolia Productivity Organization, championing national digitization. Prior to his current appointments, he was the Chairman of BigONE Exchange, a global top 30 ranked crypto spot exchange and was also the Advisory Board Member for Hyundai DAC, the blockchain arm of South Korea’s largest car manufacturer Hyundai Motor Group. Lian played a pivotal role as the Blockchain Advisor for Asian Productivity Organisation (APO), an intergovernmental organization committed to improving productivity in the Asia-Pacific region.

An avid supporter of incubating start-ups, Anndy has also been a private investor for the past eight years. With a growth investment mindset, Anndy strategically demonstrates this in the companies he chooses to be involved with. He believes that what he is doing through blockchain technology currently will revolutionise and redefine traditional businesses. He also believes that the blockchain industry has to be “redecentralised”.

www.anndy.com
j j j