Bitcoin becomes more peaceful amid strengthening dollar index, but privacy coins remain in trend

This week, the cryptocurrency market demonstrated interesting dynamics: while the main asset is correcting, the US dollar index (DXY) is gaining strength, affecting the overall asset balance. Bitcoin, which briefly rose to $92,400 yesterday, is now trading at $87.88K with a 1.65% decline over the past 24 hours. This decline did not occur in a vacuum — it is directly related to the rise in the dollar index, which weakens appetite for risky assets.

Reports of potential criminal charges against the Federal Reserve Chair triggered a wave of uncertainty in global markets. In response to this news, gold and silver received support, rising by 2% and 5.6%, respectively. Meanwhile, Nasdaq 100 futures fell approximately 1%, and the dollar index began to gain positions, signaling that investors were returning to safe assets. This is a classic scenario where the growth of DXY puts pressure on alternative assets, including crypto.

Privacy coins show divergence from market trends

Despite pressure on the overall market, privacy coins stood out as a rare exception. Monero not only recovered but also set a new record, trading at $576 — up more than 12% since Sunday. This growth occurred amid the altcoin season indicator on CoinMarketCap first shifting from the “Bitcoin season” to a neutral zone since November 18, reaching 30/100.

Zcash also continued its recovery after recent internal management disputes. Currently, ZEC is trading at $367.34 with a 24-hour decline of 6.68%, but the coin showed significant resilience compared to previous days when corrections were deeper. The increase in privacy coin holdings can be explained by investors revising their priorities amid uncertainty caused by regulatory changes and central banks’ positions regarding the dollar index.

Monero open interest reaches highs: signals of new capital inflow

Analyzing derivative data, we see a bright indicator: open interest (OI) in Monero futures reached 369,000 XMR, the highest since February last year. This, along with the price rally, indicates a flow of new capital into the network market.

However, attention should be paid to warning signals. Annual funding rates for bullish positions are approaching 80%, which is costly for holding long positions. This often signals market overheating and increased risk. Over $200 million was liquidated in leveraged futures over the past day, with 50% of this amount being bullish positions. These figures suggest that the correction after the Asian session caught many traders unprepared, who were using leverage.

Correction phase: reduced volatility and defensive positions

Implied volatility indices Volmex for BTC and ETH remain under pressure, indicating expectations of decreased price volatility in the short term. Meanwhile, open interest in leading assets — BTC, ETH, XRP, SOL, DOGE — decreased by 1%-4% over 24 hours, demonstrating increased trader caution.

In the Deribit options market, an interesting phenomenon is observed: put options on BTC and ETH continue to trade at a premium to call options across all timeframes. This indicates traders’ tendency to hedge against further declines. “Iron condor” structures on BTC and calendar spreads on ETH dominate among block flows, reflecting expectations of sideways price movement with low volatility.

Solana leads among major altcoins on meme coin recovery wave

Among major crypto assets, Solana showed relative resilience. SOL is currently trading at $123.22, down 3.24% over 24 hours. However, this decline is less sharp than the overall market, indicating specific dynamics related to the platform.

The rise in SOL is explained by increased activity in the Solana meme ecosystem. The token issuance platform Pump.fun surpassed $1.6 billion in trading volume over the past 24 hours, signaling retail investors’ return to the market. New meme coins like whale guru managed to grow by 146,000% after their launch on January 11, reaching a trading volume of $10.5 million.

Mixed picture among altcoins: from gains to declines

The native token of Aerodrome Finance, AERO, initially grew by 10% to $0.60, but later lost these gains. Currently, AERO is trading at $0.45 with a 24-hour decline of 3.02%.

Not all altcoins showed positive dynamics. LIT token from Lighter fell more than 5% over the last 24 hours, currently trading at $1.83, as interest in the platform decreased after the airdrop concluded. A similar picture is observed with Polygon, where the internal token POL dropped to $0.12, losing more than 2% over the past day from previous peak levels.

On-chain data: where is Bitcoin’s support base?

On-chain data analysis reveals an important picture of concentration. About 63% of invested funds in Bitcoin have a cost basis above $88,000. A significant concentration of supply is located in the $85,000–$90,000 range, with support below $80,000 remaining minimal.

This means that the current correction is close to zones where a large number of holders may potentially unwind their positions. At the same time, the dollar index continues to decline as a key factor influencing crypto portfolio profitability. As DXY changes direction, we can expect a reallocation of capital across alternative assets.

The current market equilibrium reflects a conflict between macroeconomic factors (dollar index, Federal Reserve rates) and intra-sector dynamics, where some segments like privacy coins demonstrate relative resilience. The outcome of this conflict will remain a key driver for crypto assets in the coming days.