Bitcoin slid to $90,639 on Friday, December 5, 2025, as crypto investors remained cautious ahead of the U.S. Personal Consumption Expenditures (PCE) inflation report, the Federal Reserve’s preferred price gauge. Market participants weighed hopes for a Fed rate cut due next week against uncertain economic indicators. Meanwhile, Bank of America is set to allow wealth advisers to recommend crypto allocations of 1% to 4% in client portfolios through regulated exchange-traded products starting January 2026, signaling deeper crypto integration in mainstream wealth management.

Bitcoin Faces Downward Pressure as Inflation Data Looms

Bitcoin last traded 1.4% lower at $90,639 by 09:02 ET (14:02 GMT), following a drop earlier this week toward $84,000, triggered by risk-off sentiment and widespread leveraged liquidations in crypto markets. A midweek recovery recouped some losses, placing Bitcoin on track for a slight weekly gain. The rebound was fueled by increasing conviction that the Federal Reserve may cut interest rates as soon as next week.

Recent data revealed U.S. jobless claims fell sharply to the lowest level in over three years, highlighting cooling labor market conditions that reinforce expectations of easier monetary policy. This outlook generally supports risk assets like cryptocurrencies, yet investors remained cautious ahead of Friday’s PCE inflation release. A softer inflation reading could strengthen the case for imminent Fed rate cuts.

Notably, institutional inflows into Bitcoin have decelerated compared to prior quarters, exposing the asset to pronounced volatility driven by derivatives activity and shifts in investor sentiment.

Bank of America Embraces Crypto in Wealth Advisory Roles

In a significant move, Bank of America (NYSE: BAC) announced it will enable wealth advisers within its Private Bank, Merrill, and Merrill Edge divisions to recommend crypto exposure in client portfolios starting January 5, 2026. The bank endorses allocations between 1% and 4% using regulated crypto exchange-traded products, reflecting rising client interest in digital assets linked to innovation themes.

To facilitate these recommendations, Bank of America strategists will initiate coverage of four major Bitcoin ETFs managed by Bitwise, Fidelity, Grayscale, and BlackRock. The firm emphasized the volatility and inherent risks associated with crypto investments despite the growing institutional acceptance.

BCA Research: Bitcoin’s Decline as a Speculative Reset

BCA Research characterizes Bitcoin’s recent sharp drawdown as a “capitulation of excess speculation” rather than a fundamental shift. The firm highlighted extreme market conditions including record leveraged liquidations and deteriorating sentiment metrics. Key indicators such as treasury-company premiums and supply-in-profit levels have fallen to lows consistent with previous market troughs, while the Fear and Greed Index resembles 2022’s extremes.

With much leverage purged, BCA argues Bitcoin is positioned to realign with macroeconomic drivers as institutional demand consolidates. ETF inflows remain active, new platforms are expanding crypto accessibility, and Bitcoin is increasingly viewed as a “global wealth insurance asset” amid rises in alternative store-of-value demand.

Altcoins Follow Bitcoin’s Decline Ahead of Economic Data

The broader crypto market reflected Bitcoin’s cautious mood. Ethereum eased 2.1% to $3,102.14 while XRP declined nearly 3% to $2.06. Other major altcoins also fell: Solana down 4.4%, Cardano down 4%, and Polygon retreating about 3%. Meme coins Dogecoin and $TRUMP fell approximately 4% and 2.8%, respectively. These declines highlight risk aversion across crypto sectors ahead of the key inflation report.

Crypto: Market Outlook

As Bitcoin hovered near $90,600 on December 5, 2025, market participants closely watch the upcoming U.S. PCE inflation figures and Federal Reserve policy signals. Bank of America’s decision to officially integrate crypto allocation recommendations signals growing mainstream acceptance, potentially igniting further institutional interest. Meanwhile, BCA Research’s view of Bitcoin’s recent weakness as a speculative reset highlights prospective renewed macroeconomic support for crypto assets. Investors should prepare for continued volatility while seeking emerging opportunities within the evolving crypto landscape.