Bitcoin fell more than 8%, falling below $94,000 as Jerome Powell dismissed speculation about Bitcoin reserves.

Bitcoin Gold continued its decline on Friday, falling below the $94,000 level. This was the fourth consecutive decline amid tense sentiment after the Federal Reserve presidency Jerome PowellMilitant tone and comments on the possibility of a Bitcoin reserve. At around 6 PM IST, Bitcoin was trading at $93,637.04, down 8.25%.

Powell said in a press conference on Wednesday US central bank He has no intention of participating in any government efforts to store large amounts of Bitcoin. “We are not allowed to own bitcoin,” he said after the Federal Reserve’s two-day policy meeting.

While the Fed cut interest rates as expected, it also signaled a less certain path for monetary policy in the coming months. Regarding the legal issues related to holding Bitcoin, Powell noted that “this is something that Congress should consider, but we are not looking for the Fed to change the law.”

Powell’s comments came in response to discussions about a potential Bitcoin strategic reserve, which could be pursued once President-elect Donald Trump takes office.In addition, the Fed’s announcement of a 25 basis point rate cut, accompanied by expectations of only two quarter point cuts in 2025, was less than the three to four cuts that markets had expected. This decline in easing expectations has raised concerns among investors.

Powell’s comments weakened the value of Bitcoin, which had been rising along with other cryptocurrencies after Trump’s election victory on November 5. This rise was driven by expectations of a more relaxed government stance towards an asset class that acts more as a vehicle for speculation than actual money.Read also: End of 2024: Bitcoin and altcoins break records, leaving stocks and gold behind

Altcoins also felt the heat as Ethereum fell 12% and traded at $3,245 around this time. Meanwhile, XRP, BNB, Solana, Dogecoin, Cardano, and Tron are down as much as 22% in the past 24 hours.

“The broader Bitcoin and cryptocurrency market faced a sharp correction today after liquidations swept over $1 billion into the futures market. Bitcoin remains highly volatile as traders react to the US Federal Reserve’s dovish tone for 2025. Notably, ETFs Spot recorded $647 million in daily outflows,” said Vikram Subburaj, CEO of Jyotos.

Avinash Shekhar, co-founder and CEO of Pi42, commented: “Bitcoin will remain resilient despite market volatility. Bitcoin’s correction below the $100,000 mark reflects caution after Jerome Powell dismissed speculation that the Fed may add Bitcoin to “His reserves.”

Read also: Small Indian cities are joining the cryptocurrency boom, expanding beyond major metros

Other major cryptocurrencies also saw declines, including XRP (2.1%), BNB (4.1%), Solana (6.9%), Dogecoin (11.8%), Cardano (8.3%), Tron (4.3%), and Avalanche (8.2%) %). Chainlink (6.5%) and Shiba Inu (9.2%).

“The altcoin market followed Bitcoin’s decline with significant declines across the board. Despite the pullback, market sentiment remains in ‘greed’ territory, with the Cryptocurrency Fear and Greed Index stable at 74,” Vikram Soburaj said.

“For Bitcoin, the $95,500 support level is now critical for a bounce. A breakdown below this level could lead to another sell-off over the weekend,” he added.

(Disclaimer: The recommendations, suggestions, views and opinions provided by experts are their own. These do not represent the views of the Economic Times.)