Cryptocurrency markets fall after the Fed's press conference

As we mentioned last week, we could expect significant volatility in the crypto markets following the FOMC meeting and the press conference of Fed Chairman Jerome Powell, and that's exactly what happened after a more restrictive approach by the Fed looking towards 2025.

Although the Fed cut rates by 25 basis points, which was already widely anticipated, the unexpected part was the revision of its outlook for 2025, reducing the expected rate cuts from three to just two, a total of 50 basis points. Additionally, they raised their inflation expectations for the end of 2025 from 2.1% to 2.5%.

As a result, the markets reacted with massive sell-offs. The total crypto market capitalization fell by 14%, dropping from $3.73 trillion (all-time high) to $3.2 trillion. Altcoins were the most affected, as Bitcoin's dominance increased despite the overall market decline.

The question now is whether we will see a deeper correction as Powell's comments are digested by the markets, or if investors will take the opportunity to "buy the dip" and remain optimistic about the long-term outlook.

#FED #SEC #bitcoin $BTC

Bitcoin retreats below its historic high of $100,000

Last week, Bitcoin marked a historic milestone by surpassing the symbolic level of $100,000, establishing a new all-time high and reaching a market capitalization of over $2 trillion for the first time.

Reaching six figures (in US dollars) is no small feat and demonstrates how far Bitcoin has come in recent years. More and more investors want exposure to this asset class, which has driven greater capital inflows into the sector.

This is especially reflected in spot Bitcoin ETFs, which continue to break records. BlackRock's IBIT ETF, the largest among spot Bitcoin ETFs, now has over $50 billion in assets and achieved this milestone in just 228 days, five times faster than any previous ETF.

Despite this, reaching $100,000, given the psychological significance of this price level, could lead some investors to take profits. We are already seeing signs of this this week, with the price falling slightly below $100,000, currently trading at $97,500.

Typical pullbacks in bullish Bitcoin markets usually range between 20% and 40%, so while the drop below $100,000 is small so far, it would not be surprising to see a deeper correction of this magnitude, especially as we approach the holiday season when investors often rebalance their portfolios in preparation for the new year.
#btc #bitcoin $BTC

Microsoft Vote on Bitcoin (December 10, 2024)

Microsoft will put to a vote a proposal to invest in Bitcoin as part of its financial strategy.

Although Microsoft's board of directors opposes it, the debate has generated strong media interest and could influence the institutional narrative of crypto adoption.

If approved, it could mark a before and after in the relationship of big tech with cryptocurrencies.

 
MicroStrategy proposal to Microsoft

Michael Saylor has formally proposed that Microsoft adopt Bitcoin in its balance sheets and financial operations, highlighting the potential to add significant market value in the long term.

Although there is no official response, this initiative underlines the growing interest of leading corporations to explore cryptocurrencies as a viable financial strategy.

#Microsoft #bitcoin $BTC

A Critical Look at Trump's Economic Agenda

Donald Trump plans major tax cuts to stimulate economic growth and boost corporate profits. However, this strategy comes at a significant cost: reduced tax revenues are likely to widen the budget deficit and further increase the $36 trillion national debt.

To address the resulting funding shortfall, Trump appears to be relying on increased import tariffs. However, trade wars present substantial risks:

1) They are notoriously difficult, if not impossible, to “win.”

2) American consumers end up bearing the burden of rising prices,
3) Economic weakness limits the effectiveness of protectionist policies.

Tariffs could also push up inflation, limiting the Federal Reserve's ability to lower interest rates further.

Combined with rising debt, reduced fiscal flexibility, and increased market risks, these factors pose significant threats to economic stability.

Scott Bessent's appointment as Treasury Secretary offers hope for stability. The hedge fund manager, known for his pragmatic approach, is expected to focus on safeguarding the economy rather than wholeheartedly pushing Trump's political agenda.

#bitcoin #Trump $BTC