Bitcoin slipped beneath the $86,000 mark on Monday, extending a short-term pullback that has erased late-November gains across major digital assets.XRP retreatedBitcoin slipped beneath the $86,000 mark on Monday, extending a short-term pullback that has erased late-November gains across major digital assets.XRP retreated

Bitcoin below $86K, XRP slips over 4%: what could spark next crypto rebound?

2025/12/16 04:02

Bitcoin slipped beneath the $86,000 mark on Monday, extending a short-term pullback that has erased late-November gains across major digital assets.

XRP retreated more than 4% in the same period, as profit-taking and shifting institutional flows weighed on sentiment.

The move highlights the cryptocurrency market’s vulnerability to macroeconomic data and monetary policy signals, even after the Federal Reserve’s rate cut failed to catalyse a sustained rally.

Traders are now watching for the catalysts that could reignite risk appetite and anchor a recovery in Bitcoin and altcoins.​

Why are Bitcoin, XRP facing a meltdown?

The near-term decline reflects a potent mix of technical selling and rebalancing activity.

Bitcoin peaked above $110,000 in early November before the broader market turbulence and mixed artificial-intelligence narratives spooked investors.

The subsequent retreat has wiped out roughly $27 billion in value for institutional Bitcoin ETF holdings, which fell from $169.54 billion in October to $120.68 billion by early December.​

Bitcoin ETF inflows reached $152 million on December 9, driven by Fidelity’s FBTC product, which garnered $199 million in new capital.

The Fed’s rate cut to 3.50–3.75% marked the third consecutive reduction in 2025, creating favorable conditions for risk assets.

However, traders quickly realized the rate cut did not signal a dramatic pivot toward aggressive easing, disappointing those betting on a liquidity surge.​

XRP tells a different story. While Bitcoin ETFs saw $154.2 million in outflows on December 12, XRP spot ETFs recorded $20.17 million in inflows, driven by Franklin Templeton’s XRPZ product, which attracted $8.7 million.

This divergence underscores a crucial dynamic: institutional capital is not fleeing crypto wholesale, but rather rotating into specific narrative-driven assets with clearer regulatory standing.

XRP’s August 2025 settlement with the SEC and subsequent ETF approvals have positioned it as a differentiated play.​

Why analysts still see upside?

A durable rebound likely requires alignment of several key factors.

First and foremost, Federal Reserve forward guidance must signal sustained easing into 2026.

Jerome Powell’s December press conference left room for interpretation; three of twelve voting members dissented on the latest rate cut, the highest dissent since 2019.

If the Fed truly commits to an accommodative policy and weakens the dollar, crypto historically responds favorably.

Bitcoin rallies have historically coincided with falling real rates and expanded liquidity.​

Second, institutional ETF inflows must stabilize.

The $22.32 billion in net Bitcoin ETF inflows through December 4, despite October’s $48.86 billion AUM decline, suggests conviction among large asset managers.

BlackRock’s IBIT fund, which commands 48.5% of the US Bitcoin ETF market, saw November outflows, but the long-term accumulation pattern persists.​

Third, XRP-specific catalysts matter. Ripple’s pending national bank charter and acquisition of Hidden Road (now Ripple Prime) position XRP for institutional-grade payment services.

Analysts estimate $5-7 billion could flow into XRP ETFs by 2026 if regulatory momentum continues.​

Finally, technical stabilisation is essential. Bitcoin holds critical support near $85,000–$88,000.

A decisive break below $86,000 could target $80,500, but any reclaim above $95,000 would likely trigger momentum algorithms toward $99,000–$107,000.​

The path forward hinges on whether the Fed’s December cut marks the start of a dovish cycle or merely a pause.

Until clearer guidance emerges, expect continued volatility punctuated by institutional accumulation into dips, a pattern likely to persist through year-end.

The post Bitcoin below $86K, XRP slips over 4%: what could spark next crypto rebound? appeared first on Invezz

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