LIVE MARKETS-Even crypto activity is slowing as the year ends

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EVEN CRYPTO ACTIVITY IS SLOWING AS THE YEAR ENDS

Crypto trades round the clock, but even liquidity there is starting to slow down for the year end.

Open interest for Bitcoin perpetual futures across major exchanges fell by approximately $3 billion overnight, according to a Tuesday note from crypto fund QCP Capital, while for ether it declined by about $2 billion.

The fund says this shows: "risk is being taken off rather than redeployed".

Price action too has been pretty muted, bitcoin BTC= has been hovering around the $90,000 level for the last 10 days or so.

Of course less liquidity means if something does happen, moves can be exacerbated, and QCP say bitcoin "has tended to experience 5 to 7% swings during the Christmas period" often linked to year end options expiry.

However, they continue: "holiday-driven moves have historically tended to mean-revert. Much like low-liquidity weekend spikes that often retrace once markets reopen, Christmas week price action typically fades as liquidity returns in January."

So even crypto traders may be able to take some time off.

(Alun John)

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