The Federal Reserve firmly rejects cryptocurrencies, Bitcoin continues to plummet
The Federal Reserve (Fed) will continue to tighten its purse strings next year, causing gold to drop initially.
As for Bitcoin, once it broke the $100,000 mark, it directly fell to around $92,000, but later the market stabilized a bit, and Bitcoin returned to around $95,000.
However, compared to the recent peak of $108,000, it is still lower.
Strahinja Savic, an analyst at financial company FRNT Financial, told Bloomberg, "It's quite normal for the cryptocurrency bull market to fluctuate."
Bitcoin has still risen 130% this year, and it surged nearly 50% after Trump's win. But when the Federal Reserve took a hard stance on December 19, risk assets trembled.
The Federal Reserve also stated that any interest rate cuts next year will be gradual. Jerome Powell, the head of the Federal Reserve, said that according to the law, they "can't even touch Bitcoin."
He also mentioned that if Trump wants to establish a cryptocurrency reserve, they won't change the law to accommodate it.
The analysis team at cryptocurrency platform QCP Capital stated, "The Federal Reserve is taking the blame; the market exploded mainly because they were too excited."
In just 15 days, the Bitcoin ETF fund saw outflows of $680 million yesterday, setting a record, which drastically changed market sentiment.
When Trump won, the cryptocurrency market surged rapidly. However, QCP Capital warned that investors are too optimistic; when the Federal Reserve moves, the market trembles.
With Trump about to take office, trade tariffs are also being wielded, and whether it concerns friends or foes, the cryptocurrency market may remain turbulent during this year-end holiday. Additionally, the Federal Reserve may ease some policies, and whether financial institutions accept Bitcoin is something everyone is watching closely.
Hani Abuagla, a senior market analyst at XTB, stated, "Monetary policy, institutional acceptance, and political developments all need to be monitored. As for Bitcoin, by 2025, it will still be guided by macroeconomic factors and the cryptocurrency realm."
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