Today, the broader cryptocurrency market continued to fluctuate, with Bitcoin's price facing significant setbacks. Due to immense selling pressure in the broader financial markets (not to mention the digital asset space), the flagship cryptocurrency recently fell below the $100,000 level. Notably, this pullback in BTC occurred after the Federal Reserve decided to cut interest rates and Chairman Jerome Powell's remarks.
The drop of Bitcoin price below $100,000 sparked market discussions.
Since Donald Trump won the U.S. election this year, Bitcoin's price has been on the rise. This has sparked market sentiment favoring a regulatory environment for cryptocurrencies under the new president's leadership. Additionally, institutional interest in BTC has surged, as evidenced by strong inflows into the U.S. spot Bitcoin ETF.
However, despite this, cryptocurrencies faced significant setbacks this week. BTC recently fell below the $100,000 mark, indicating that many investors are selling off rapidly against the backdrop of macroeconomic concerns triggering overall volatility in financial markets.
The Federal Reserve announced a 25 basis point interest rate cut at its latest meeting yesterday, meeting market expectations and boosting investor optimism in the short term.
Nevertheless, the latest comments from Federal Reserve Chairman Powell have dampened investor sentiment. In his recent remarks, Powell suggested that the Fed might slow the pace of interest rate cuts before next year, triggering discussions in the market.
Meanwhile, the Federal Reserve stated that the central bank has halved its previously expected number of interest rate cuts. Specifically, the central bank might only lower the policy rate twice in 2025, down from the previously expected four cuts throughout the year. This has triggered selling pressure in the market, affecting the price of Bitcoin.
Will BTC see a recovery in the future?
The price of Bitcoin dropped nearly 3% today, trading at $101,738, with trading volume rising by 22% to $95 billion. In the past 24 hours, the flagship cryptocurrency hit a low of $98,792 and a high of $105,302, reflecting highly volatile market trading conditions. Additionally, it reached an all-time high of $108,268 on December 17.
However, despite the short-term correction in cryptocurrency prices, experts remain bullish. Many market analysts suggest that given the bullish trend, cryptocurrencies are expected to recover in the future. Reports indicate that the U.S. is considering establishing a strategic reserve for Bitcoin, which boosts market confidence in the asset. Furthermore, other global leaders, including EU politicians, are also targeting similar initiatives.
Considering all these aspects, market sentiment remains strong. Meanwhile, in a recent analysis, top market expert Ali Martinez predicted that BTC would drop to $99,000. However, he also noted that once BTC rises above $105,400, the bearish momentum would begin to fade.
In addition, Peter Brandt recently stated that BTC is expected to reach $125,000 in the future, reflecting his confidence in this flagship cryptocurrency. At the same time, Bitwise's CIO indicated that once the U.S. establishes a Bitcoin strategic reserve, the price of Bitcoin will reach $500,000.
Nevertheless, experts have repeatedly warned of short-term corrections, as is the case currently. As a background, Arthur Hayes stated that Bitcoin will continue to face corrections while predicting that the cryptocurrency market may crash during Trump’s inauguration on January 20. However, despite the bearish prediction, Hayes pointed out that the market will continue to rise.
