Not quite the Christmas cheer we were all looking for this evening, as the world's top cryptocurrencies took a nosedive following a week and a half of constructive gains.
The public equity markets, too, have been taking it on the chin, with the Nasdaq officially moving into bear market territory.
Before this drop, there was a potential inverse relationship taking hold between equities and crypto. Would crypto become a store of value for capital, in the way that gold has been for centuries? Alas, the pairing came undone and crypto has followed the broader market down.
If a new relationship is unfolding, in which equities and crypto trade in tandem, then participants have a right to worry. In an unprecedented move this week, Treasury Secretary Steve Mnuchin called the heads of the top U.S. banks to reassure them of liquidity in the system. "Totally baffled" was the term used.
A run-of-the-mill risk-off environment has taken hold and cryptocurrencies have fallen victim. The vast majority of capital in the crypto markets is speculative and as equity markets unravel, so too will risky assets.
Last week, I wrote a piece about Justin Mamis' Sentiment Chart. It is a chart that applies human emotion to market cycles. Bitcoin has been following Mamis' chart rather concurrently, and if it holds, then rocky, but blue, skies are just around the corner as the token climbs what Mamis' termed, the Wall of Worry.
The world might be entering a risk-off environment, but keep an eye on a surprise denouement to this story.