The cryptocurrency market experienced a notable rebound on December 2, 2025, with Bitcoin and leading altcoins posting gains and pushing the total market capitalization back toward $3 trillion. This upward movement is linked to two primary, data-driven factors: a significant cooling in futures market liquidations and a dramatic shift in monetary policy expectations.
Data from derivatives tracking platform CoinGlass shows that market-wide liquidations plunged by approximately 60% on Tuesday, falling to $328 million. This marks a stark contrast to the extreme volatility of recent months, most notably the October 10 flash crash that saw over $20 billion liquidated in a single day. A sharp drop in liquidations signals reduced forced selling pressure, allowing for a more stable price recovery. Concurrently, the futures open interest—representing the total value of unsettled contracts—saw a slight uptick, indicating a cautious return of capital to the market.
The most significant macroeconomic catalyst, however, is the surging probability of a Federal Reserve interest rate cut. Data from the prediction market Polymarket, which had over $212 million in assets on this contract, showed the odds of a 0.25% rate cut at the Fed's December meeting soaring to 90%. This is a substantial reversal from a November low of less than 50%. Lower interest rates are historically bullish for risk-on assets like cryptocurrencies, as they reduce the opportunity cost of holding non-yielding investments and can increase liquidity in the financial system. This shift in expectations has provided a fundamental narrative for the day's rally.
Despite the positive momentum, analysts warn the move could be a technical "dead cat bounce" or bull trap—a temporary recovery within a broader downtrend. The market has seen several such false recoveries in recent months, with Bitcoin briefly rallying in early November before resuming its decline. The sustainability of the rebound hinges on whether the improving derivatives data and dovish Fed outlook can translate into sustained buying volume and a break of key resistance levels.
In a contrasting development, the native token of the Hyperliquid ecosystem (HYPE) defied the broader market trend, showing significant weakness. Technical analysis indicates the asset is at risk of a deeper correction toward $19, having failed to hold critical support near $29. This bearish structure persists despite a recent positive fundamental development: Hyperliquid was selected by Paxos, alongside Aptos and Plume, as one of the primary networks for launching its new USDGO stablecoin. This news has yet to catalyze buyer interest, with fading bullish volume leaving the token vulnerable to further downside. This divergence highlights the selective and cautious nature of the current market recovery, where broad macro tailwinds do not guarantee gains for all assets.