In the Arena | December 1, 2025

“3 observations and a chart” on the latest in the digital assets sector

Short term pain, no panic — downturn in digital assets feels worse than it is (and offers a buying opportunity)

The recent drawdown in digital assets has produced a familiar sense of frustration across the market, but the data paints a very different picture. Bitcoin’s 2025 performance has tracked its long-term historical rhythm with surprising precision: a soft Q1, a strong Q2, a drifting Q3, and an atypical—but still statistically normal—Q4 pullback. Drawdowns of 30 % or more are in fact commonplace in Bitcoin’s history of up-cycles, and institutional commentary increasingly frames such pullbacks as buying opportunities rather than red-flags. Crucially, nothing in this downturn resembles systemic stress. No lenders failing, no exchanges blowing up, no depegs, no hidden leverage unwinding behind the scenes. We’re experiencing valuation drift, not contagion, and the foundation is intact, liquidity is functioning, and the market’s long-term drivers remain firmly in place.

“Buy Now, Pay Later” Giant Klarna launches stablecoin – another payments company using crypto rails

Klarna, the “buy now, pay later" provider with 114 million users worldwide and $112 billion of annual gross volume processed, is launching KlarnaUSD, a USD-backed stablecoin built on the Tempo blockchain to cut cross-border payment costs. The move is especially notable for the reversal in tone: a payments giant whose CEO was previously skeptical of crypto now says the industry is “fast, low-cost, secure, and built for scale.” With stablecoin settlement volumes approaching $27 trillion annually, Klarna’s decision reinforces what we’ve long highlighted — stablecoins are becoming a key technology solution for global payments, not because of speculative hype but because they simply work better.

T. Rowe Price enters crypto arena with ETF offering

Eighty-seven year-old Wall Street stalwart T. Rowe Price is stepping into the digital assets sector. The $1.8 trillion asset manager filed with the SEC to launch an actively managed crypto ETF—a multi-coin vehicle expected to hold between five and fifteen digital assets. For a firm synonymous with conservative mutual-fund investing, the move marks a striking acknowledgement that the growth frontier has shifted onchain. The filing positions T. Rowe alongside peers like BlackRock, Fidelity, and Franklin Templeton, all of whom have embedded crypto into their product suites over the past year. We highlight this as yet another data point in the accelerating convergence between traditional finance and the onchain economy—where even the most established asset managers are retooling for a world in which crypto isn’t a sideshow, but a core component of modern portfolio construction.

Chart of the Month – Coinmarketcap Fear and Greed Index at extreme level of fear…often a good time to buy…

Source: https://coinmarketcap.com/charts/fear-and-greed-index/

Arena Digital Capital Partners is a liquid evergreen fund open to monthly subscriptions. We are always happy to discuss further with you or investors you think may have an interest in the sector. Please reach out to Bill Cline at williamc@arenadigital.capital.

Sincerely,

The Arena Digital Capital Management Team

Michael Schwartz, Michael Prober & William Cline

www.arenadigital.capital

Arena Digital Capital Management was founded in January 2022 by three experienced traditional finance hedge fund professionals who have been deploying personal capital in the digital asset ecosystem since 2018. The team has managed billions of dollars of capital for high net worth individuals, family offices, and institutions ranging from pension plans and endowments to sovereign wealth funds. We have worked closely with institutional consultants, RIAs, and other advisors in serving their clients.

In May 2022 we launched Arena Digital Capital Partners, with the goal of providing a multi-strategy investment vehicle to access the digital asset ecosystem. Our mandate is to offer broad exposure across the growing digital asset and blockchain sector with an appropriate level of diversification, professional oversight, and manager selection. Our collection of skill sets and our history in the business allows us to understand, assess, and engage with the practitioners of this nascent asset class with a level of diligence required to be responsible stewards of capital. We are happy to periodically share our observations with you.

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