Crypto markets fell on Sunday as a broader pullback in risk assets extended into the final full trading week of the year, with investors remaining cautious amid concerns over tech valuations, fading momentum in U.S. stocks and mixed signals from the Federal Reserve.
Bitcoin fell around 0.5% to trade near $89,600, sitting just above last week’s lows, while ether edged lower at around $3,120. Most major tokens traded lower on the day, with XRP, Solana and Dogecoin posting losses of up to 2%, according to market data.
The move comes as U.S. stock index futures rebounded slightly from last week’s tech-sector-related selloff, triggered by renewed scrutiny over big spending on artificial intelligence and earnings sustainability.
While S&P 500 and Nasdaq 100 futures rose about 0.2% Monday morning in Asia, risk appetite remained fragile as investors reassess whether high valuations of tech stocks can be justified through 2026.
This caution has carried over into crypto markets, which have struggled to regain momentum after October’s sharp decline. Trading volumes have declined noticeably in recent sessions, amplifying price movements and reinforcing the defensive tone.
“Right now, investors are hesitant to invest in cryptocurrencies given the October decline, concerns about an overvalued US stock market and mixed signals from the Fed,” Jeff Mei, chief operating officer of cryptocurrency exchange BTSE, said in a Telegram message.
“That being said, Bitcoin ETF inflows are still positive and the Fed has started buying back securities from the market, adding liquidity that could flow into stocks and crypto,” he added.
Mei added that year-end positioning is likely behind the current weakness. “Given that it is the end of the year, traders are likely taking profits now and will reevaluate whether they want to initiate new crypto positions in early 2026,” he said.
Others warned that weak liquidity could exaggerate downward moves in the coming weeks.
“This morning’s cryptocurrency sell-off is a continuation of Friday’s negative bias and we expect the majors to continue to lead the way lower,” said Augustine Fan, head of analytics at SignalPlus. “As trading volumes have declined significantly since the 10/10 event and sentiment has turned largely negative, expect BTC and ETH to act as a hedging proxy for all other tokens as traders adjust their exposures.”
Fan cautioned against overinterpreting short-term price fluctuations. “We wouldn’t want to read too much into the day or time in these difficult conditions, but overall sentiment remains deeply negative and the trajectory of weaker resistance likely portends a year-end price decline,” he said.
Despite near-term pressure, US-listed Bitcoin exchange-traded funds and continued liquidity support from central banks could provide a more constructive backdrop once markets fully reopen in early 2026.
