Bitcoin and Ether finished December with little sign of the year-end blowout that traders often bank on, capping a quarter that shows how fragile crypto rallies can look when liquidity dwindles and risk appetite diminishes.
The so-called “Santa Gathering” never actually happened. Instead, Bitcoin’s repeated attempts to reclaim key levels sold off, while ether and large-cap tokens followed lower.
Bitcoin is on track to finish December down about 22%, its worst month since December 2018, while Ether is on track to finish the fourth quarter of 2025 down 28.07%, according to data maintained by CoinGlass.
A “Santa Rally” is the upward market trend during the last week of December and early January, driven by low liquidity, year-end portfolio rebalancing, and optimistic holiday sentiment.
This weak finish is important because crypto has historically relied on strong year-end flows to create early-cycle momentum. This time, December feels more like a positioning reset than the start of a new leg upwards.
As Bitcoin’s fourth quarter performance turned sharply negative, the quarterly band now reads as an absence of risk rather than an increase in risk.
The contrast with precious metals is hard to ignore.
Gold hit new record highs on rate cut expectations and geopolitical tensions, while silver surged and platinum also hit new highs, as CoinDesk previously reported.
Gold has benefited from continued demand from central banks and increased allocations to ETFs, strengthening its role as a reserve-like hedge when investors are worried.
In comparison, Bitcoin trades more like a high beta asset. Even as the macroeconomic backdrop points to looser policy, Bitcoin has struggled to hold on to gains without a broader risk offering.
The pattern became familiar in late 2025, where rebounds were offset by rapid profit-taking, leverage was reduced over the holidays and U.S. trading hours tended to see the heaviest selling as funds cleaned up their positions.
Volatile returns and an unstable dollar have kept investors in capital preservation mode, a setup that tends to favor gold first and speculative assets second.
The first test will be whether Bitcoin can hold its recent support zones into the new year. If not, the failure of the Santa rally could be seen as an early warning that the market still needs a deeper reset before the next sustained rally.
