QCP Capital: BTC’s Year-End Performance Hinges On Liquidity Conditions And Global Macro Developments

In Brief

Bitcoin faces a crucial test to maintain support levels as bearish sentiment and global macro pressures challenge its year-end performance.

Singapore-based digital asset firm QCP Capital published a market update indicating that Bitcoin began December under pressure after trading sideways during a quiet Thanksgiving period. The price fell from $91,000 to $86,000 during early Asian trading hours, erasing most of the previous week’s gains within hours.

Analysts attributed the selloff to a series of bearish developments across Asia. Hawkish remarks from Bank of Japan Governor Ueda led swap markets to price in higher probabilities of a Japanese rate hike, pushing the two-year Japanese yield to 1% and implying a 76% chance of an increase at the 19th December BOJ meeting

Additionally, China’s purchasing managers’ index showed a contraction in non-manufacturing activity for the first time in nearly three years, raising concerns about slowing regional economic growth. Collectively, these factors prompted investors to question whether global liquidity is genuinely easing, despite ostensibly supportive macro conditions in the United States.

The decline was further amplified by comments from Strategy CEO Phong Le, who mentioned that the firm could liquidate BTC holdings if its stock fell below net asset value and funding options became limited. These remarks triggered panic, forcing liquidations of leveraged long positions and increasing market anxiety regarding Strategy’s potential exclusion from major stock indices ahead of Nasdaq’s annual review on 12th December and its upcoming dividend payment.

Bitcoin Faces Key Support Test Amid Mixed Macro Signals And Shifting ETF Flows

Despite these sentiment pressures, the macroeconomic environment remains relatively supportive for cryptocurrency. Quantitative tightening officially ends today, December rate cut odds have risen to 87% on Kalshi, and the probability of pro-crypto candidate Kevin Hassett becoming the next Federal Reserve Chair has increased to 66%. Spot exchange-traded fund (ETF) flows have returned to net inflows, indicating a positive shift.

Nevertheless, Bitcoin’s price action has diverged from the broader macro narrative. Following a 15% rebound from recent lows around $81,000, a pullback was expected. The key question is whether BTC can hold previous support levels as bearish sentiment continues to build, with outcomes likely influenced by liquidity conditions and Strategy-related flows. Bitcoin’s responsiveness to liquidity changes remains pronounced, and the recent decline highlights that sensitivity.

With US liquidity easing and macro headwinds from Asia intensifying, the upcoming trading sessions will be critical in determining whether Bitcoin can close 2025 in positive territory.

At the time of writing, Bitcoin is trading at $85,852, reflecting a 5.93% decline over the past 24 hours, with a low of $85,811 and a high of $91,837. The total global cryptocurrency market capitalization stands at $2.92 trillion, down 5.67% over the same period, while 24-hour trading volume has reached $138.32 billion, marking a 70.72% increase.