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Key Takeaways
Bitcoin has moved back above $95k USD for the first time since November of 2025.
But, even as sentiment is starting to shift, there are significant push and pull forces that could make or break the crypto market.
Chart of the week: In the middle of 2025
This week is one where I’ve genuinely struggled to land on a clean conviction. And that’s not my attempt at an easy out for this article.
Bitcoin is back above $95,000 USD, trading at its highest level since November 2025. This week we’ve welcomed news of inflation continuing to cool in the US, with both CPI and PPI coming in softer. More on that soon.
So, let’s break down the potential good...and the potential bad on the horizon as the crypto market enters the new year.
The Good
This week’s US inflation data came in lower than expected, with both core consumer inflation (CPI) and core producer inflation (PPI) figures pointing to inflation pressures easing across the economy.
Remember from our previous Squawk that policy makers are looking at stressors across both employment and inflation when walking the tightrope between tightening or easing economic conditions. So this is a major piece of the puzzle to help investors, and the US Federal Reserve, to understand how things are shaping up.
Since these data releases on Tuesday and Wednesday, Bitcoin has maintained its uptrend.
But are there unknowns on the horizon that could deal a massive blow to market sentiment?
The Unknown
The Clarity Act in the US is the next big piece of legislation for the crypto industry. Its purpose is to clearly define how digital assets are regulated and which agencies oversee them. Whenever you’ve heard someone talking about the need for a regulated industry, well, this is the big ticket.
It is imminently awaiting a vote in the US Senate. The risk here is if the bill is shot down, it wouldn’t be surprising to see the air taken out of the tires of market optimists. Crypto markets are impacted by sentiment, and this could be a negative blow. However, it’s also worth noting that a pushback against the bill may be for revisions that improve its effectiveness within a crypto framework.
Rising tensions between the US and Iran adds another layer of uncertainty the market can’t easily price, but may react to. Geopolitical escalations rarely move crypto on fundamentals alone, but they do again impact sentiment.
Chart of the week: In the middle of 2025
The chart below is my final attempt at showing just how Malcom in the Middle this market really is.
Below is a channel of the 2025 range high and low of total market cap as measured by TradingView. And this can’t do any better job of showcasing technically how pivotal the next few weeks are ahead.
We’ll soon get an idea if this week's bullish move was just simply mean reversion, a move back to the middle. Or, will we see a firm commitment from the market to reclaim this point of interest – and potentially push higher.
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So hopefully now it makes a little bit more sense why I’m happy to wait and see what happens. The crypto market has seen an amazing period of growth to kick off 2026, but I wonder if the unknowns ahead could impact sentiment more than what we know.
Could reasons to be doubtful or hesitant take the wind out of the sails? Or is the current uptrend a sign of things to come?
If you’ve got a crystal ball, now would be a great time to dust it off and let the rest of us know.
See you all again next week.