The cryptocurrency market roared back to life on December 28, 2018, posting one of the most convincing single-day rallies in what had been a grueling bear market. Bitcoin surged nearly 9%, while Ethereum led all major altcoins with a stunning 16.9% gain — a move that caught many traders off guard during the final trading week of the year.
TL;DR
- Bitcoin jumped 8.88% to $3,919, breaking above the psychologically important $3,900 level
- Ethereum outperformed all major cryptocurrencies with a 16.9% rally to $135.50
- Altcoins joined the party: BCH +14.2%, LTC +16.0%, EOS +15.5%
- Kraken recorded $172 million in total trading volume across all markets
- The rally came despite continued mining difficulty adjustments and bearish macro conditions
A Christmas Miracle for Crypto Traders
After weeks of relentless selling pressure that had pushed Bitcoin below $3,800 just days earlier, the December 28 rally provided a much-needed respite for exhausted crypto traders. On Kraken, one of the largest cryptocurrency exchanges at the time, Bitcoin climbed 8.88% to settle at $3,919, with $75.9 million in BTC trading volume recorded on the platform alone.
But the real story was Ethereum. The second-largest cryptocurrency by market capitalization surged an impressive 16.9% to reach $135.50, with $57.2 million in volume on Kraken. ETH’s market capitalization climbed to approximately $15.54 billion, representing 11.87% of the total cryptocurrency market. The ETH/BTC pair showed significant strength, with Ethereum outperforming Bitcoin by roughly a 2-to-1 margin on the day.
Altcoins Join the Relief Rally
The rally was decidedly broad-based. Bitcoin Cash, which had been battered during the November hash war between ABC and SV camps, rebounded 14.2% to $172.80. Litecoin posted a 16.0% gain to $32.44, while EOS climbed 15.5% to $2.68. Even smaller cap assets like Monero (+14.4%), Dash (+10.4%), and Zcash (+12.6%) participated in the recovery.
XRP, which had remarkably overtaken Ethereum for the number two spot by market cap during parts of December, gained 9.07% to $0.3754. The total trading volume across all Kraken markets reached $172 million — a significant figure for a holiday week that traditionally sees lower activity.
The Bear Market Backdrop
Context is critical for understanding the significance of this rally. December 2018 marked the tail end of crypto’s most punishing bear market. Bitcoin had crashed over 80% from its all-time high near $20,000 set exactly one year earlier in December 2017. The industry was reeling from a cascade of negative developments: the Bitcoin Cash hash war, regulatory crackdowns, and a broader collapse in speculative interest.
Just 25 days earlier, on December 3, Bitcoin’s mining difficulty had experienced its second-largest drop in history — a stunning 15.13% decline. The network hash rate had fallen approximately 39% from its late-August peak of 61.9 EH/s down to 37.7 EH/s, as miners with older, less efficient equipment were forced to shut down operations. The average cost of producing one Bitcoin was estimated at around $4,500 — well above the market price — creating an unprecedented squeeze on mining operations.
Ethereum’s DeFi Foundation Being Laid
While the market rally dominated headlines, a quieter revolution was taking shape on the Ethereum network. MakerDAO’s Single-Collateral Dai (SAI) was live and operational — the first truly decentralized stablecoin on Ethereum. Though total value locked in DeFi protocols was a fraction of what it would become, the primitives being built in late 2018 would eventually form the foundation of a trillion-dollar ecosystem.
Developers continued building through the bear market, with the Ethereum network processing smart contracts and serving as the settlement layer for the emerging decentralized finance stack. The resilience of ETH’s price on December 28 — gaining nearly 17% in a single day — reflected growing recognition that the Ethereum network had fundamental value beyond speculation.
Traditional Markets in Turmoil
The crypto rally on December 28 coincided with extreme volatility in traditional markets. The S&P 500 had experienced its largest reversal since 2010, and the U.S. government had entered a partial shutdown on December 22 that would stretch into January 2019. The parallel between risk-off conditions in equities and a risk-on move in crypto was not lost on market observers, though whether it signaled a genuine decoupling or was simply a bear market bounce remained hotly debated.
Why This Matters
The December 28, 2018 rally was one of the first signs that the brutal crypto winter was approaching its end. While Bitcoin would not definitively bottom until it touched roughly $3,200 in mid-February 2019, the Christmas-week recovery demonstrated that buyers were still willing to step in at these depressed levels. For DeFi proponents, the rally in ETH was particularly meaningful — it showed that the market was beginning to differentiate between coins with active development ecosystems and those that were purely speculative vehicles. The infrastructure being built during these dark days — MakerDAO, early DEX protocols, and the ERC-721 standard for non-fungible tokens — would prove to be the seeds of crypto’s next great bull run.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Cryptocurrency investments carry significant risk. Always conduct your own research before making investment decisions.
BTC jumping 8.88% to break $3900 in the middle of crypto winter was a signal that the bottom was in – december 2018 marked the turning point
ETH outperforming everything with 16.9% to $135 was the real story – ethereum was quietly building the DeFi infrastructure that would define the next cycle
that $3900 level held as support through january – this christmas rally was the first real sign that 2019 would be different