Bitcoin’s price experienced a sharp decline following the US Federal Reserve’s recent rate cut. However, market experts like Bitwise CIO Matt Hougan remain optimistic about the asset’s long-term trajectory. The Federal Reserve announced a 25-basis-point rate cut and scaled back its outlook for 2024 to two cuts instead of the previously expected four.
The Fed chair also stated that it cannot hold BTC under current regulations. This triggered market reactions, with Bitcoin’s price falling to $98,839 before stabilizing at $101,586. Other top digital assets like Ethereum, XRP, and Solana also recorded losses of around 5%, 5.5%, and 3%, respectively.
Data from CoinGlass shows that this red market performance led to around $800 million in liquidation, impacting more than 270,000 traders. Despite this pullback, Hougan reassured investors that Bitcoin’s fundamentals remain strong. He attributed Bitcoin’s recent resilience to internal crypto-specific factors such as growing institutional adoption, pro-crypto shifts in US policy, and government and corporate Bitcoin purchases.
He also highlighted significant blockchain advancements and increasing ETF flows as additional drivers of market strength.
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