A sharp decline in bitcoin shortly after the CME futures market reopened, combined with unexpectedly hawkish commentary from the Bank of Japan, pushed the CoinDesk 20 (CD20) Index down nearly 6% on Monday.

The downturn began within minutes of the CME bitcoin futures open, triggering broad weakness across crypto. The CD20 Index has fallen 5.98% over the past 24 hours, reflecting a market still struggling with thin liquidity after October’s $19 billion liquidation cascade.

Sentiment worsened as Bank of Japan Governor Kazuo Ueda signaled the possibility of an interest-rate hike this month. His remarks sent Japan’s 30-, 10- and 2-year government bond yields to their highest levels since 2008. A potential rate increase would strengthen the yen, prompting hedge funds that typically borrow the currency to buy risk assets—including bitcoin—to reassess their positions.

Derivatives positioning

• The sell-off triggered a rapid pullback from crypto futures markets. Open interest (OI) in tokens such as ZEC, SUI, UNI and ENA slid more than 10% in 24 hours.
• Bitcoin’s OI dipped 2%, while ether’s edged slightly higher to 12.51 million ETH—its highest reading since Nov. 21—suggesting traders may be shorting the move lower.
• Market sentiment has turned sharply bearish, with annualized funding rates between -7% and -11% across assets including SOL, BBB, XRP, AVAX and DOT, indicating a strong tilt toward short positions.
• Volmex’s 30-day bitcoin implied volatility index (BVIV) spiked during Asian trading hours, briefly surpassing 55% before easing to 53%, signaling heightened fear as prices fell.
• On Deribit, put skews strengthened in short- and near-dated BTC and ETH options.
• Block trading flows highlighted BTC strangles and ETH straddles—strategies typically used when traders expect significant volatility.

Token performance

Altcoins were hit even harder by Monday’s market slump. Zcash (ZEC) plunged 20%, while ENA and TIA fell 16% and 14% respectively. Of the $637 million in liquidations recorded over the past 24 hours, more than $430 million came from altcoin positions as multiple tokens extended downtrends that began in early October.

The market is nearing a critical point: a break below November’s lows would confirm a broader bearish reversal from the October highs. Still, the average Relative Strength Index (RSI) now shows oversold conditions, suggesting the possibility of a relief bounce as short sellers take profits.

A few tokens managed to stay positive on a weekly basis. Layer-1 token KAS rose 29% over the past seven days, while SKY—the rebranded DeFi token formerly known as MKR—gained 17% following a series of buyback announcements.

Meanwhile, the “altcoin season” index remains subdued at 24/100, sharply lower than its reading of 78/100 in September, indicating that investors continue to favor bitcoin’s relative liquidity and stability.