Crypto markets have danced to the tune of the Santa Claus rally effect eight times in the last ten years, according to an interesting report from Coingecko, penned by analyst Lim Yu Qian.
Holiday Cheer or Crypto Chill? Coingecko Breaks Down the Santa Rally Effect
The Santa Claus rally is all about the market’s cheer during the final five trading days of the year and the first two of the new year. Coingecko’s research discovered that from 2014 to 2023, the total crypto market capitalization jumped anywhere from 0.69% to 11.87% after Christmas, from Dec. 27 to Jan. 2.
The time before Christmas has been a bit of a mixed bag, with rallies happening only five times in that same decade. In the week leading up to Christmas, from Dec. 19 to Dec. 25, market gains varied from 0.15% to 11.56%. However, there were also some significant dips, especially in 2017, when the crypto market plummeted 12.12% after the initial coin offering (ICO) bubble burst.
Bitcoin, leading the pack, mirrored these trends. Over the past decade, bitcoin (BTC) celebrated early Christmas with gains seven times, ranging from 0.20% to 13.19%. Post-Christmas, bitcoin enjoyed positive movements five times, with increases from 0.33% to 10.86%. The biggest drop came before Christmas in 2017, when bitcoin tumbled 21.30%.
Coingecko’s analysis also highlighted years where crypto markets partied with rallies before and after Christmas. This festive double happened just three times in the last decade, in 2016, 2018, and 2023. In 2016, the total crypto market capitalization climbed 11.56% before Christmas and 10.56% after. In 2018, gains were more modest at 1.31% and 4.53%, while 2023 brought increases of 4.05% pre-Christmas and 3.64% post-Christmas.
Even with these occasional patterns, Coingecko’s report reminds us that the Santa Claus rally in crypto markets is anything but predictable. Market performance throughout December has been a rollercoaster, showcasing the wild ride that is the crypto sector.
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