Original | Odaily Planet Daily ( @OdailyChina )
Author | Asher ( @Asher_0210 )
This morning, the Federal Reserve announced a 25 basis point cut in its benchmark policy rate, but hinted that the number of rate cuts in 2025 may be lower than previously expected (lower than the four forecast in September and lower than the three market expectations before the meeting). Moreover, Powell described this shift as a new phase of monetary policy, and emphasized that after a 100 basis point rate cut in 2024, interest rates are now significantly closer to a neutral position. Such a hawkish signal caused both the U.S. stock market and the cryptocurrency market to dive.
OKX real-time market data shows that as of 10:50 today (hereinafter referred to as this time point), BTC has fallen below $99,000 and is currently trading at $99,600, a 24 -hour drop of 5.38%, falling below $100,000.
In addition to BTC, ETH fell below $3,600 at its lowest point and is currently trading at $3,630, a 24 -hour drop of 6.03%; SOL briefly fell below the $200 mark and is currently trading at $203.83, a 24 -hour drop of 6.94%;
Other mainstream altcoins also fell sharply. Among the top 100 currencies by market value, the Meme sector fell the most, with WIF falling below $2.5, a 24 -hour drop of 17.6%, temporarily reported at $2.24; FLOKI fell below $0.000185, a 24 -hour drop of 17.5%, temporarily reported at $ 0.000184; PEPE fell below $0.000019, a 24 -hour drop of 16.3%, temporarily reported at $0.0000187;
As for U.S. stocks, as of the close of the day, all three major stock indexes fell, with the Dow Jones Industrial Average initially closing down 2.59%, setting a record for the longest single-day decline in 50 years (the 10th consecutive trading day of decline); the SP 500 closed down 2.95%, and the Nasdaq closed down 3.56%;
Affected by the overall upward trend, the total market value of cryptocurrencies has also fallen rapidly. According to CoinGecko data, the total market value of cryptocurrencies has fallen below $2.6 trillion, down 8% in 24 hours. Crypto users trading enthusiasm has also declined. Alternatives panic and greed index today is 75, and the level has changed from extreme greed to greed.
In terms of derivatives trading, Coinglass data shows that in the past 24 hours, the entire network has a liquidation of $853 million, of which long orders have a liquidation of $752 million and short orders have a liquidation of $101 million. In terms of currencies, BTC has a liquidation of $157 million and ETH has a liquidation of $135 million.
Bitcoin fell below $100,000 for the first time this week, and altcoins are also bleeding. When asked about Bitcoin reserves, Powell said, You are not currently allowed to own Bitcoin, and you dont want to change the law. Is the policy bull market coming to an end, or are there other variables before Trump officially takes office?
Below, Odaily Planet Daily will sort out the views and arguments of institutions on the future market conditions.
What will be the future trend of Bitcoin?
FalconX: Rate cut forecasts may not affect the crypto market in the long term, and the correlation between Bitcoin and major stock indexes has declined
David Lawant, head of research at crypto prime broker FalconX, said, “While rate cut forecasts are currently impacting prices, they may not have a long-term impact as Bitcoin’s correlation with major stock indices has fallen. The slower pace of rate cuts expected in 2025 is not entirely surprising, but it has put some pressure on risk assets, including cryptocurrencies. While macro factors have traditionally influenced cryptocurrency price action, sector-specific factors may dominate in the coming weeks and months, especially as markets anticipate policy changes from the new administration.”
Santiment: Bitcoins decline is not as large as normal fluctuations compared to the SP 500
Analysts at blockchain analysis platform Santiment said, Despite BTCs disappointing short-term price reaction, the correlation between Bitcoin and many altcoins and the stock market has weakened slightly this month. During the bull market, when cryptocurrencies have little or no correlation with stocks, cryptocurrencies will flourish. Considering that BTC is temporarily maintained above $100,000 and the decline is not as large as normal fluctuations compared to the SP 500, this can actually be interpreted as a strong signal once the dust settles in the next 24 to 48 hours.
Grayscale Research: Sovereign wealth funds in Asia and the Middle East are more likely to be the next driving force
Zach Pandl, head of research at Grayscale, said: Bitcoin prices plummeted after Fed Chairman Powells speech, suggesting that investors may be overestimating the theoretical possibility of Bitcoin strategic reserves. Grayscale Research expects more nation-states to adopt Bitcoin, but the next step is more likely to be sovereign wealth funds in Asia or the Middle East, which already manage highly diversified asset pools.
Bitwise: Tightening liquidity and a stronger dollar are the biggest risks facing BTC
Andre Dragosch, head of European research at Bitwise, believes: The biggest trouble for the Fed right now is that despite the Feds rate cuts, the financial environment remains tight. Since September, long-term bond yields and mortgage rates have been rising, and the dollar has appreciated, which also means a tightening financial environment. The continued appreciation of the dollar also poses macro risks to Bitcoin, because the appreciation of the dollar is also related to the contraction of the global money supply, which is often not conducive to Bitcoin and other crypto assets. In fact, the Feds net liquidity continues to decrease. In my opinion, tightening liquidity and a stronger dollar are also the biggest risks facing BTC... On the other hand, BTCs on-chain factors continue to be very favorable, especially the continued decline in exchange balances, which supports the assumption that the BTC supply gap continues to intensify.
Split Capital founder: Feds dovish stance is expected to weaken in 2025
Zaheer Ebtikar, founder of crypto fund Split Capital, said: Global markets expect the Feds dovish stance to be less in 2025. Therefore, crypto event traders and market makers are reducing risks. Federal Reserve officials cut their benchmark interest rate for the third consecutive time on Wednesday, but controlled the number of rate cuts expected in 2025. Lower interest rates generally increase demand for most riskier assets, such as cryptocurrencies.
summary
This morning, after the Federal Reserve released a hawkish signal, the markets expectations for Bitcoin began to diverge, especially the general bullish sentiment before breaking through the $100,000 mark has weakened. At present, optimists believe that Bitcoins correlation with traditional stock markets has dropped significantly, and Trump has repeatedly mentioned the establishment of a strategic Bitcoin reserve, which still provides support for Bitcoins future prospects.
However, changes in the macroeconomic environment, such as the appreciation of the US dollar and tightening liquidity, may put some pressure on the price of Bitcoin in the short term.
