🔻 Bitcoin took a hit on Tuesday, tumbling 5% to $96,525.50 (📊 Coin Metrics data). Meanwhile, Ether slid a sharp 8%, and the broader CoinDesk 20 Index shed 7%, signaling a rough day for the crypto market.
📉 Crypto Stocks Take a Beating
Coinbase: ⬇️ more than 8%
MicroStrategy: ⬇️ over 9%
Bitcoin miners like Mara Holdings and Core Scientific also slipped by 7% and 6%, respectively.
📈 What’s Behind the Drop?
A sudden surge in the 10-year U.S. Treasury yield spooked investors. The yield spike followed data from the Institute for Supply Management, which revealed unexpectedly fast growth in the U.S. services sector for December. This raised fears of persistent inflation 📊.
🛑 Rising yields tend to pressure risk assets, especially growth-oriented ones like cryptocurrencies.
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📈 Bitcoin’s Recent Rally & 2025 Outlook
Bitcoin traded above $102,000 on Monday and is still widely expected to nearly double this year 🚀. Investors are optimistic that clearer regulations will boost digital asset prices, benefiting companies like Coinbase and Robinhood.
⚠️ Challenges Ahead
Uncertainty over the Federal Reserve’s interest rate policy could create hurdles. In December, the Fed hinted at fewer rate cuts in 2025 than investors had hoped for. Historically:
Rate cuts = 🚀 positive for Bitcoin.
Rate hikes = 🚨 negative for Bitcoin.
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📊 The Bigger Picture
Despite this recent drop, Bitcoin is still up 3% since the start of 2025. Last year, it surged by a massive 120%.
Will 2025 deliver another stellar run? Or will rising yields and Fed uncertainty cap its gains? Stay tuned!
⚠️ Disclaimer: The information provided in this article is for informational purposes only and does not constitute financial, investment, or trading advice. Cryptocurrency markets are highly volatile, and past performance is not indicative of future results. Always do your own research and consult with a professional advisor before making investment decisions.
Source : CNBC News