Matrixport Market Observation: Finding Support Under Pressure, Crypto Market Enters a Critical Observation Period

In the past two weeks, the cryptocurrency market has experienced a significant correction, driven by multiple factors including macroeconomic conditions, policies, regulations, and structural deleveraging within the industry. U.S. economic data has remained resilient, and inflation has fallen short of expectations, leading to a continuous narrowing of the space for interest rate cuts this year. The probability of a rate cut in December has decreased from over 80% at the beginning of the month to about 50%, with high interest rates putting pressure on the valuations of risk assets. At the same time, several Federal Reserve officials have signaled hawkish stances, further reinforcing market expectations of "higher rates lasting longer." Coupled with the slow progress of cryptocurrency ETF approvals and geopolitical tensions, market risk aversion has noticeably intensified.

BTC and ETH Deep Correction, Industry Deleveraging Accelerates

Internally, the deleveraging process within the industry has clearly accelerated, with rumors of "whale sell-offs" and concentrated liquidations of high-leverage long positions amplifying short-term declines. The resonance between macro tightening and structural clearing in the industry has become a significant driver of the rapid cooling in the market.

As of November 24, Bitcoin is priced at approximately $87,000, and Ethereum at about $2,800. Over the past month, Bitcoin has continued to decline from above $100,000 in late October, with a cumulative correction of about 20% during the month, dipping to around $81,600 at one point; Ethereum has fallen from nearly $3,500, breaking below the $3,000 mark, with a monthly decline of about 15% to 20%.
Technical indicators show that the daily RSI for BTC and ETH has entered the oversold territory, and sentiment indicators have dropped to "extreme fear" levels, with short-term selling pressure having been relatively concentrated.

Stablecoin Fund Flows: Outflows Slow, Approaching Phase Stabilization

On-chain fund flows indicate that the total market capitalization of stablecoins has seen a net outflow of about $3 billion over two weeks in mid-November, with noticeable redemption pressure on USDC and relatively stable USDT. The outflows of stablecoins reflect a phase of cautious sentiment among investors, but since late November, the scale of net outflows has significantly slowed, showing initial signs of stabilization. Historically, multiple rounds of cyclical bottoms are often accompanied by a halt in the decline of stablecoin supply, making this signal worthy of continued attention.

Derivatives Market Risk Elevated: Key Price Volatility May Be Amplified

The derivatives market simultaneously reflects rising uncertainty. The implied volatility of short-term options has rapidly risen from its low in October to a high range for the year. From the perspective of open interest distribution, there are still a large number of $80,000 put options by the end of November, while a significant accumulation of $125,000 call options has occurred by the end of December, which significantly amplifies the gamma exposure near these key price levels. If prices approach these critical strike prices, short-term volatility may be further amplified.

Structural Sectors Remain Resilient: Mid to Long-term Value Still Exists

Within structural sectors, RWA, the Solana ecosystem, and Ethereum Layer 2 have all corrected alongside the broader market, but there has been no substantial deterioration in fundamentals. The RWA sector has seen an increase in on-chain scale and institutional participation this year; Solana's on-chain activity continues to grow; and Ethereum Layer 2's locked value remains on an upward trend throughout the year, indicating that structural opportunities still exist.

Allocation Suggestions: Balancing Offense and Defense Amid Uncertainty

For investors who believe the market has entered a value range and wish to gradually buy in to lower their costs, it is advisable to purchase Accumulator products. For those concerned about further market declines and wishing to preserve capital while obtaining stable returns, considering daily dual-currency (inverse) products could be beneficial for achieving high returns while holding stablecoins. The current market is entering a critical turning point, and it is recommended that investors adjust their strategy allocations based on their risk preferences: aggressive investors can use accumulation products to position core assets at low levels to capture price rebound benefits; conservative investors should focus on capital preservation and gains, obtaining certain returns through dual-currency and coupon products, and gradually reducing positions if necessary. Matrixport's series of structured products allows investors to flexibly employ options strategies in a bear market, achieving a configuration effect that can both attack and defend.

The above content is from Daniel Yu, Head of Asset Management, and represents the author's personal views only.

Disclaimer: The market carries risks, and investment should be approached with caution. This article does not constitute investment advice. Trading in digital assets may involve significant risks and volatility. Investment decisions should be made after careful consideration of personal circumstances and consultation with financial professionals. Matrixport is not responsible for any investment decisions made based on the information provided herein.