PakGazette– Bitcoin fell on Thursday, moving further away from its recent high, as a hawkish outlook from the U.S. Federal Reserve raised concerns about tighter monetary conditions and eroded risk appetite.
Fed Chair Jerome Powell also said that the central bank has no intention of participating in any government initiatives to accumulate substantial amounts of Bitcoin, further dampening confidence.
fell 2.6% to $101,153.0 at 01:08 CET (0609 GMT). The cryptocurrency briefly fell below $100,000 during the session.
The world’s largest cryptocurrency had hit an all-time high of $108,244.9 on Tuesday after incoming President Donald Trump further raised the prospect of a Bitcoin Strategic Reserve last week.
Bitcoin falls lower due to the Fed’s aggressive tone
The Federal Reserve cut by 25 basis points, but signaled it will adopt a slower pace for future cuts.
Authorities were now seen supporting just two rate cuts in 2025, half the previous expectations of four, signaling a more cautious stance and a prolonged period of elevated borrowing costs.
The central bank’s hawkish stance weighed on Bitcoin as tighter monetary policy reduces liquidity, making speculative assets like cryptocurrencies less attractive.
Broader risk-driven assets also plunged on this notion, with Wall Street posting sharp declines on Wednesday.
Powell rules out Bitcoin purchase plans; El Salvador reverses Bitcoin push for IMF deal
Federal Reserve chief Powell said the central bank was not allowed to accumulate large amounts of Bitcoin, saying “that’s the kind of thing Congress needs to consider, but we’re not looking for a law change at the Fed.” Federal”.
The response came while discussing the possibility of the central bank participating in the government’s plan to create a Bitcoin Strategic Reserve after President-elect Donald Trump takes office.
While his comments have no direct bearing on the prospect of a Bitcoin reserve, they underlined growing doubts over whether the reserve will ever come into existence, given the regulatory hurdles it will likely face. Trump had outlined plans to build a reservation, but gave few clues about how they would be carried out.
El Salvador’s President Nayib Bukele, meanwhile, agreed to scale back his plan to make Bitcoin a national currency in exchange for a crucial $1.4 billion loan from the International Monetary Fund.
The deal with the IMF marks a sharp departure from Bukele’s Bitcoin ambitions, after he embraced the cryptocurrency in 2021 and even outlined plans to issue Bitcoin-backed bonds.
While El Salvador has since frozen these ambitions, the country’s Bitcoin reserves have seen a big jump in their valuation following the cryptocurrency’s latest rally.
Crypto Price Today: Most Altcoins Plunge After Fed Meeting
Other cryptocurrencies followed Bitcoin’s lead as traders became cautious after the Federal Reserve meeting. With two consecutive days of declines, most altcoins have lost most of the ground they had gained last week.
The world’s No. 2 cryptocurrency fell 4.7% to $3,684.62, extending its decline. The world’s No. 3 cryptocurrency fell 5.6% to $2.3701.
was 2.5% lower and plummeted 6%, while it fell more than 4%. Among meme tokens, it lost 5.6%.
On Wednesday, Hong Kong’s securities regulator approved four cryptocurrency exchanges as part of the city’s latest initiative to remain competitive in the global race to become a hub for digital asset trading.
