December 2024 latest marked a pivotal moment in the cryptomarket, showcasing dramatic shifts, record-breaking achievements, and forward-looking policy changes. Decentralized exchanges (DEXs) hit unprecedented heights with $462 billion in monthly volume, underscoring the growing dominance of DeFi platforms. Meanwhile, the U.S. and Hong Kong unveiled bold plans, with President-elect Trump promising a crypto-friendly administration and Hong Kong proposing Bitcoin as part of its national reserves.

Amidst these highlights, market sentiment took a turn as Bitcoin's price faced corrections, accompanied by a dip in the Fear & Greed Index. Ethereum stood out with a surge in long-term holders, reflecting growing confidence in its ecosystem, while Bitcoin investors opted for profit-taking, leading to contrasting trends for the two leading assets. This period encapsulated the dynamism of the crypto industry, setting the stage for an eventful 2025.

1. DEXs Hit Record $462 Billion Monthly Volume

In December 2024, decentralized exchanges (DEXs) recorded their highest-ever monthly trading volume, reaching $462 billion. This milestone surpassed the previous high of $374 billion set in November, reflecting the growing popularity of decentralized finance (DeFi). Platforms like Uniswap, PancakeSwap, and Raydium led this surge, with $106 billion, $96 billion, and $58 billion in respective volumes. The rise in DEX activity underscores a shift toward decentralized platforms, offering transparency and user control over assets.

Interestingly, while DEX volumes flourished, the memecoin market faced a sharp correction, with market capitalization dropping from $137 billion to $92 billion in December. This shift suggests traders are pivoting toward established protocols and away from speculative assets, further solidifying DeFi’s growth trajectory in the crypto ecosystem.

2. Donald Trump’s Pro-Crypto Stance Signals Market Transformation

President-elect Donald Trump has vowed to make the U.S. the "crypto capital of the planet," promising a favorable regulatory environment for cryptocurrencies. His administration plans to appoint crypto-friendly officials, including David Sacks as "AI & Crypto Czar," aiming to attract institutional investment and foster innovation. Analysts predict this could drive Bitcoin prices near $200,000 and bolster the cryptocurrency market in 2025.

However, concerns about increased market volatility remain. While Trump's agenda may accelerate adoption, it could also intensify speculative activity. Still, his supportive stance is expected to pave the way for significant advancements in blockchain technologies and heightened investor confidence.

3. Hong Kong Proposes Bitcoin as a National Reserve

Hong Kong legislator Wu Jiezhuang has proposed adding Bitcoin to the region’s national reserves to strengthen financial security and stability. Inspired by El Salvador and Bhutan, Wu believes such a move could attract global talent and investment while positioning Hong Kong as a digital asset leader.

Wu advocates for an incremental approach, starting with Bitcoin ETFs before expanding holdings. This proposal aligns with Hong Kong’s broader strategy of creating a secure and innovative digital asset framework. As the region embraces Bitcoin’s potential as "digital gold," it aims to enhance its status as a forward-thinking financial hub.

4. Bitcoin’s Fear & Greed Index Falls Amidst Year-End Decline

In late December, Bitcoin’s price dropped by 13.7%, landing around $93,000. This correction coincided with a decline in the Crypto Fear & Greed Index to a two-month low of 65, marking a significant shift in market sentiment from extreme greed to caution. Despite short-term volatility, Bitcoin remains the best-performing asset of 2024, with a 129% return compared to traditional investments like gold.

cryptomarket analysts are divided on what’s next. While some foresee increased volatility, others maintain a bullish outlook for Bitcoin, citing strong fundamentals and institutional support. As the market digests these fluctuations, the long-term trajectory of Bitcoin remains optimistic.

5. Ethereum Long-Term Holders Surge as Bitcoin Investors Take Profits

Throughout 2024, Ethereum (ETH) witnessed a significant rise in long-term holders, climbing from 59% to 75%. This trend contrasts with Bitcoin, where long-term holders decreased from 70% to 62%, likely due to profit-taking during Bitcoin’s recent price rally. Ethereum’s increased adoption is further highlighted by doubling ETF inflows, which reached $2.1 billion in December.

The data reflects growing confidence in Ethereum’s ecosystem, driven by advancements in DeFi, scalability, and institutional adoption. Meanwhile, Bitcoin’s correction suggests a natural market adjustment, as investors rebalance portfolios after substantial gains.

6. Bitcoin Dips Below $94,000, Bears Take Charge?

Bitcoin’s price slipped below $94,000 on December 29, raising concerns about bearish market control. The Taker-Buy-Sell Ratio fell below 1, signaling heightened selling pressure. Additionally, the rising dominance of Tether (USDT) indicates a flight to stability among investors.

Despite bearish signals, some traders remain optimistic, as Bitcoin’s funding rates for perpetual contracts stay positive, showing confidence in long positions. Moreover, Bitcoin continues to hold above its 200-day exponential moving average (EMA), hinting at underlying support. While the market braces for potential short-term volatility, Bitcoin's long-term bullish case remains strong.

Key Insights

1. DEXs Break Records While Memecoins Decline

• Decentralized exchanges achieved a record $462 billion in trading volume, led by platforms like Uniswap and PancakeSwap.
• This growth underscores the increasing shift toward decentralized platforms for transparency and control.
• Memecoins, however, saw a sharp decline, losing 20% of their market capitalization in December.

Key Insight: The DeFi sector continues to gain momentum, while speculative assets face a reality check.

2. Trump’s Crypto Push Sets Bullish Expectations

• President-elect Trump’s pro-crypto stance aims to make the U.S. a global crypto leader.
• Policies include appointing crypto-friendly officials and fostering institutional investment.
• Analysts predict these moves could drive Bitcoin toward $200,000 in 2025 but warn of potential market bubbles.

Key Insight: U.S. policy shifts could catalyze adoption but introduce volatility risks.

3. Hong Kong’s Bitcoin Reserve Proposal Highlights Regional Ambitions

• Hong Kong explores adding Bitcoin to national reserves, inspired by El Salvador’s example.
• Legislators propose starting with ETFs before direct integration into reserves.
• This move could solidify Hong Kong’s reputation as a forward-thinking financial hub.

Key Insight: Regional players are increasingly leveraging Bitcoin as a strategic asset.

4. Bitcoin Sentiment Weakens as Fear & Greed Index Drops

• Bitcoin fell to $93,000 amid a market sentiment shift from extreme greed to caution.
• Despite short-term corrections, Bitcoin outperformed other assets in 2024 with a 129% return.
• Analysts remain optimistic about Bitcoin’s fundamentals despite temporary volatility.

Key Insight: Short-term corrections don’t overshadow Bitcoin’s broader growth trajectory.

5. Ethereum Outpaces Bitcoin in Long-Term Holding Trends

• Ether holders retaining assets for over a year grew from 59% to 75% in 2024.
• Bitcoin’s long-term holder percentage declined, reflecting profit-taking behavior.
• Ethereum’s doubling ETF inflows signal rising confidence in its ecosystem.

Key Insight: Ethereum’s growth highlights its increasing appeal to both retail and institutional investors.

6. Bitcoin Bears Emerge, But Bullish Support Remains

• Bitcoin dropped below $94,000, with bearish indicators such as a lower Taker-Buy-Sell Ratio.
• Positive funding rates and technical support suggest traders remain optimistic.
• Bitcoin’s price still hovers above critical moving averages, pointing to long-term support.

Key Insight: While bears test the waters, Bitcoin’s structural strength persists.