The Fed Looms Like a Grinch Regarding Bitcoin, Ethereum, and XRP – DL News
- Federal Reserve Chairman Jerome Powell struck a hawkish tone on 2025, spooking investors who were enjoying the big rallies.
- Bitcoin fell 8% to $92,000, while XRP fell 13%. They both rebounded.
- However, concerns are increasing as liquidity declines during the holidays.
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The Federal Reserve’s hawkish outlook for 2025 has spooked investors.
It was cryptocurrencies Hit hard. Bitcoin fell by double digits overnight, though it has since recovered. It is now down 2.5% to $97,400.
Ethereum fell a whopping 12%, while Ripple (XRP) and Solana fell 10% and 12%, respectively. Most digital assets have erased their previous losses.
The touchdown came from Powell Hard stance More cuts for 2025. Investors are betting on four cuts next year.
The aggressive tone they displayed caught traders by surprise – and they did not wait to respond.
Although investors expected a 0.25% rate cut at the Fed’s meeting on Wednesday, the aggressive outlook for next year surprised traders.
Investors also fear a potential US government shutdown.
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Markets are pricing in the fallout after the Republican-led House of Representatives rejected a temporary funding plan backed by Trump.
Now investors are wondering if this is a bad omen.
Powell also disputed the possibility of a strategic reserve of bitcoin in the United States — an idea even bitcoin users have I say it’s a bad idea.
But it is not only cryptocurrencies that are being harmed. US stocks also recorded significant losses, although they rebounded quickly.
Michael Saylor’s MicroStrategy, which outperformed Bitcoin, rose 8% after losing that pre-market value.
The decline was a short win for short sellers, as well The naysayers who doubted On Bitcoin Seller only strategy. (Ben Weiss I took a stab at finding out what MicroStrategy’s 1,637 employees actually do.)
With liquidity declining amid a struggle between bears and bulls during the holidays, expect more volatility. This Santa trail may have a tough journey ahead of it.
Pedro Solimano is a markets correspondent based in Buenos Aires. Got a tip? Send him an email at psolimano@dlnews.com.
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