BTC ATHs Continue & Solana Dominates

GM Anon!

We’re in full frenzy mode—BTC is smashing new all-time highs almost daily, and the memecoin madness just keeps heating up. Adding to the excitement, it’s been confirmed that Gary Gensler will step down in January, a move that’s being widely celebrated across the crypto industry. Without further ado, let’s dive in!

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TLDR

• SOL broke its previous all-time high, cementing its position as one of the strongest-performing assets of the cycle

• XRP, ADA, XLM, and ALGO posted strong gains as capital rotated into older assets, signalling renewed investor interest

• SUI’s blockchain experienced downtime, but surprisingly, this had little to no impact on its price

• TikTok-inspired meme coins saw explosive growth

• Meme rune collections rallied hard, fuelled by speculation of Binance listings for collections like DOG, though they retraced later in the week

• After hitting its lowest ETH/BTC ratio since early 2021, ETH showed signs of life, breaking its prolonged stagnation

Industry & Macro Moves

BTC continues its climb toward $100K, though a significant sell wall looms at this level. The rally is driven by a combination of regulatory optimism and expectations of macroeconomic stimulus, such as Japan's recent approval of an $87B economic package. These measures, part of a broader global trend of increasing liquidity, are likely to further fuel global markets.

Corporate adoption is gaining traction even as prices hit all-time highs. Michael Saylor is set to pitch BTC as a treasury strategy to Microsoft's board, despite initial resistance. With major shareholders like BlackRock and Vanguard in play, the proposal highlights shifting attitudes toward BTC as a corporate reserve asset.

In the US, regulatory sentiment is tilting pro-crypto. President-elect Trump’s nomination of crypto advocate Howard Lutnick as Commerce Secretary and consideration of blockchain expert Teresa Goody Guillén for SEC Chair signal a major shift. These moves align with Trump’s pledge to replace Gary Gensler and implement clearer, business-friendly crypto policies, energizing institutional players.

Meanwhile, a cooling dollar rally and rising global liquidity create a favorable backdrop for risk-on assets like BTC. As government policies, corporate adoption, and retail enthusiasm converge, markets appear primed for continued momentum—though volatility remains a key factor to monitor.

Amid this positive news, exchange activity has surged. Daily trading volumes have hit a 12-month high of $117B, while USD-backed platforms recorded $229B by mid-November, approaching October’s total of $237B.

In an interesting development, the chart below highlights BTC's fluctuating 30-day correlations with traditional financial assets such as the S&P 500 (SPX), Nasdaq (NDQ), Gold, Treasury Bonds (TLT), and the US Dollar Index (DXY). These dynamic correlations suggest that BTC’s behavior in relation to these assets is evolving, reflecting its unique position in the market. 

Recently the correlations appear less consistent, indicating that BTC's price movements may be increasingly independent of traditional asset classes. This potential decoupling could signal that BTC is maturing into its own macro asset, influenced more by sentiment, liquidity, and adoption trends than by traditional risk-on/risk-off market dynamics.

BTC Metrics Overheated

We’ve entered a phase where it seems like everyone is winning—profits are widespread, and trading feels almost effortless. However, markets rarely operate this smoothly for long. Such conditions often serve as a critical warning sign. If this doesn’t signal a potential peak, it’s hard to imagine what would.

Couple this with us entering the euphoria zone.

Open interest has reached another significant peak, raising important questions about the market's next move. Will we hit the much-anticipated $100K, enjoy a brief celebration, and then experience a sharp correction? Or will the market pull back first, only to climb to $100K afterward? The outcome ultimately depends on how much volatility the market is prepared to inflict. Stay vigilant.

Given the current market conditions, we expected funding rates to be much higher. However, they remain relatively manageable—though still elevated—indicating significant speculative activity without yet reaching the extreme, unsustainable levels often seen before a major correction. That said, in an overheated market, even "manageable" funding rates can escalate rapidly, making caution essential.

Futures volume has reached levels not seen in years, reflecting a surge in speculation and market participation. This spike often marks pivotal moments, signaling either a euphoric continuation or the potential for a sharp reversal. The aggressive positioning by traders at these volumes highlights the heightened risk of volatility. Whether this activity results in a breakout to new highs or a significant correction remains uncertain, but one thing is clear: the market is alive with intensity.

Moving on to the liquidation maps—what levels should we keep an eye on if a pullback occurs? While these levels are not exact, they offer valuable insight into potential targets. Data from Coinglass and Coinank highlight a significant concentration of liquidations around the $75K range. If market sentiment were to sour, a temporary drop to this level is certainly within the realm of possibility. Negative news combined with heightened fear could serve as the perfect storm to trigger a sharp, albeit brief, decline to this zone if the conditions align.

To wrap up this section, stay vigilant and carefully manage your risk in the days and weeks ahead.

General Metrics & Flows

The Stablecoin Exchange Flow shows a significant increase in both incoming and outgoing transactions, indicating heightened market activity. This suggests that traders are actively positioning themselves, possibly in anticipation of a major market move. The increase in stablecoin balances on exchanges is typically associated with readiness to deploy capital into other cryptos, often signaling bullish sentiment. It could also indicate growing market participation, with traders looking to take advantage of upcoming opportunities or prepare for volatility.

In contrast, the ETH Exchange Flow reveals a steady inflow and outflow of ETH, with a slight net outflow from exchanges. This pattern may point to reduced sell pressure on ETH, as traders move it off exchanges into cold storage or deploy it in DeFi protocols. This behavior often aligns with market confidence, where participants hold ETH for longer-term strategies or yield generation.

Over the past month, capital inflows have shifted heavily toward Base. The rotation reflects changing market dynamics as investors seek growth opportunities in emerging platforms. Whether Base can sustain this momentum remains to be seen, but it’s clear it has become a key player in the current landscape.

Hyperliquid’s TVL has surged to $1.23B, with $500M added in November alone, cementing its position as one of the major protocols of this cycle. As a next-generation decentralized exchange focusing on high-performance derivatives trading, Hyperliquid has attracted significant attention for its low latency and user-friendly experience and will likely be a hub of activity throughout this cycle.

Solana-based protocols and platforms have dominated revenue generation over the past seven days, showing no signs of slowing down. Pumpfun, combined with Photon, have transformed the market, propelling crypto speculation to unprecedented levels. Notably, there are no Layer 2 solutions in the top 10—a surprising development worth paying attention to.

Majors & Memes

The crypto market continued its bullish trajectory this week, with BTC making significant strides toward the $100K milestone, coming within just 0.6% of reaching this key psychological level. While BTC commanded early attention, SOL quickly took center stage, breaking its previous all-time high and reaffirming its status as one of the most resilient and high-performing assets of this cycle.

Legacy assets such as XRP, ADA, XLM, and ALGO also saw substantial gains, driven by renewed investor interest in older coins as capital rotated across the market. One surprising development was the downtime experienced by SUI’s blockchain, which, interestingly, did not appear to impact its price.

The meme coin sector remained a standout, with strong rallies midweek on Wednesday and Thursday. However, utility-focused tokens struggled to keep pace, highlighting a continued preference for speculative assets. ETH also showed signs of renewed strength, finally breaking its prolonged stagnation—a positive development for investors seeking momentum in the second-largest crypto.

AI-related tokens, including RENDER and AKT, posted impressive double-digit gains earlier in the week, fuelled by growing excitement in the sector. However, sentiment shifted following NVIDIA’s earnings report, leading to a sharp reversal in their recent rallies.

Ratios

The SOL/BTC ratio is showing strong resilience, with SOL holding its ground against BTC, unlike ETH, which hit fresh lows this week before its bounce. If BTC takes a breather, SOL could be primed to extend its upward momentum and demonstrate even greater market strength. That said, it’s not that ETH won’t eventually catch up, but the opportunity cost of holding ETH has been significant for believers during the early stages of this market cycle.

The ETH/BTC ratio dropped to its lowest level since early 2021 this week, driven by BTC reaching new all-time highs and BTC dominance continuing to climb.

Meme Highlights 

This week saw a major rotation into TikTok-inspired meme coins, showcasing the unpredictable nature of crypto memes. A standout event occurred on Solana’s Pumpfun platform, where a young creator live-streamed the launch and rug pull of Gen Z Quant, cashing out $30K and crashing the project. In a surprising twist, the crypto community pumped the coin’s market cap to $45M to troll him after being rugged.

This week also saw meme rune collections gaining significant momentum, driven by speculation that major collections like DOG could soon be listed on top exchanges such as Binance. This buzz has put the ecosystem in the spotlight as a potential space for substantial gains. While runes experienced a strong rally earlier in the week, with impressive pumps over a couple of days, they have since retraced. The screenshot below captures their performance during the peak of this activity. Keep an eye on this ecosystem—it could be the next big mover in the market.

That wraps up today's insights! We hope you enjoyed today’s issue! Till next time anon.