Bitcoin Falls Below $100,000 on Fed Rate Concerns
Bitcoin dropped below the $100,000 mark on Thursday, pressured by expectations of fewer rate cuts in 2025.
While other risk assets like stocks attempted a rebound after Wednesday’s sharp declines, Bitcoin continued to slide.
By midday, the leading cryptocurrency was down over 5%, trading near $98,835.
Other major cryptocurrencies also experienced losses, with Ethereum and XRP both falling more than 4%.
The total crypto market capitalization declined nearly 7%, reaching $3.41 trillion, according to CoinMarketCap.
The sell-off came after the Federal Reserve’s December policy meeting on Wednesday, where officials delivered hawkish guidance on interest rates for the upcoming year.
Despite a 25 basis point rate cut, the Fed reduced its projections for 2025, now expecting just two rate cuts instead of the four forecasted in September.
Fed Chair Jerome Powell intensified the sell-off in risk assets with his comments, emphasizing a "cautious" approach to policy changes and leaving the door open for future rate hikes.
"After breaking $108K on Wednesday, Bitcoin has now dipped below $100K. The entire crypto sector has come under pressure in the wake of the equity market pullback," noted Louis Navellier, chief investment officer at Navellier & Associates, in a Thursday morning note.
Bitcoin initially crossed the $100,000 milestone in early December, fueled by a multi-week rally following Donald Trump’s election victory.
Dubbed the "crypto president" by enthusiasts, Trump has sparked optimism in the crypto community, with hopes he may ease regulations and even encourage the U.S. government to buy Bitcoin.
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