On December 19th, Bitcoin experienced a sudden short-term drop in the early morning, falling below the $100,000 mark around 10 AM to $98,744. Other cryptocurrencies also saw significant declines, with Ethereum dropping to $3,540 and Dogecoin falling to $0.34, both with intraday declines exceeding 5%.
Both bulls and bears are fiercely battling. According to Coinglass data, in the last 24 hours, a total of 269,437 people were liquidated globally, with a total liquidation amount of $781 million; the largest single liquidation occurred on Binance-ETH, valued at $7.1005 million.
Affected by the short-term decline in cryptocurrencies, related stocks in the US stock market performed poorly last night. Riot Platforms' stock price plummeted by 14.46%, Canaan Inc. fell by 12.79%, and BitDigital dropped by 12.09%; Coinbase was down by 10.2%. The 'Bitcoin shadow stock' MSTR also suffered a heavy blow, with a decline of 9.52%.
Federal Reserve decision suppresses risk appetite
In terms of news, on December 18th local time, the Federal Reserve announced a 25 basis point reduction in the target range for the federal funds rate to between 4.25% and 4.50%, in line with market expectations.
Federal Reserve Chairman Powell held a press conference that day regarding the interest rate cut decision, stating that the Fed will likely be 'more cautious' when considering adjustments to policy rates in the future.
Powell stated that the decision to cut rates in December was more challenging, but it was the 'right decision.' He indicated that whether the Federal Reserve will cut rates in 2025 will be based on future data rather than current predictions, and the Fed will consider further cuts only after inflation improves.
It is worth noting that Powell stated at a press conference that the Federal Reserve does not intend to include Bitcoin on its balance sheet. 'We are not allowed to own Bitcoin,' Powell said, noting that the Federal Reserve Act specifies what the Federal Reserve can own, and the Fed does not seek to change that; this is a matter Congress should consider, but the Fed does not wish to modify the law.
According to a report by China Fund News, David Lawant, research director at cryptocurrency prime broker Falcon X, stated that while current interest rate cut predictions are affecting prices, there will be no long-term impact, as the correlation between Bitcoin and major stock indices has decreased. Lawant believes that the Federal Reserve's slowing pace of interest rate cuts in 2025 is not entirely unexpected, but it has indeed had some impact on risk assets, including cryptocurrencies.
Previously, Trump appointed former PayPal COO David O. Sacks as the head of artificial intelligence and cryptocurrency affairs at the White House. This appointment marks the first time the U.S. federal government has a dedicated position responsible for cryptocurrency. These actions support Trump's previous commitment to 'make the U.S. a global cryptocurrency capital and establish a strategic Bitcoin reserve.'