Major cryptocurrencies retreated from overnight highs during Asian trading, with bitcoin holding above a key support level even as investor sentiment remains deeply negative.

The crypto market stayed above critical technical levels through Asia hours, with bitcoin trading near $78,400 and ether around $2,290. Gains faded after midnight UTC as several major tokens gave back earlier advances.

While U.S. equities and precious metals rallied, digital assets lagged, underscoring ongoing relative weakness across the sector. Sentiment remains under pressure, with the Fear and Greed Index at 17 out of 100 — a reading of “extreme fear” — as traders increasingly conclude that October’s highs marked the end of the bull cycle and that the subsequent decline reflects a broader bear market.

Some analysts suggest the downturn may be short-lived, pointing to a potential bitcoin price floor near $60,000. Others remain cautious. A CryptoQuant analyst said market structure continues to deteriorate, leaving downside risks unresolved.

One notable exception has been HyperLiquid’s HYPE token, which has jumped more than 70% over the past week. The rally has been fueled by a surge in trading activity in HyperLiquid’s silver futures market, pointing to heightened retail participation.

Derivatives positioning

Bitcoin’s annualized 30-day implied volatility remains above its 200-day simple moving average, signaling the potential for continued price turbulence. Ether shows a similar volatility profile.

More than $300 million in leveraged crypto futures positions were liquidated over the past 24 hours, though total open interest across crypto futures has stabilized near multi-month lows around $110 billion.

Open interest in futures tied to major tokens, including BTC, ETH, SOL, and XRP, declined over the past day. In contrast, HYPE futures open interest surged nearly 20%, indicating fresh capital positioning on the bullish side.

Perpetual futures funding rates for major cryptocurrencies remain slightly positive, suggesting a modest bullish bias. On Deribit, put option premiums for bitcoin and ether eased slightly from Monday, though puts remain more expensive across multiple expiries, reflecting persistent demand for downside protection.

Block trading activity showed interest in bitcoin strangles, a volatility-focused strategy, and ether risk reversals, commonly used as low-cost hedges.

Token moves

HYPE continued to outperform, supported by rising volumes and revenue, while parts of the broader altcoin market rebounded. Polygon’s POL token, along with LIT and MORPHO, posted gains of up to 13% over the past 24 hours.

The advances followed a low-liquidity weekend selloff that pushed several assets into oversold territory. In thin trading conditions, limited order-book depth can amplify price swings, particularly in altcoins.

Privacy-focused tokens Monero (XMR) and Zcash (ZEC) failed to extend their early-year gains, sliding more than 20% over the past week and an additional 3.5% since midnight.

Another relative outperformer has been Canton’s CC token, which rose 28% over the past week amid growing institutional interest. Canton is a privacy-enabled layer-1 blockchain designed for institutional finance and real-world asset tokenization. In December, market infrastructure firm DTCC announced a partnership with Canton to tokenize U.S. Treasury securities on the network.