Bitcoin has fallen below the $100,000 threshold amid cautious market sentiment ahead of the Federal Reserve's upcoming interest rate decision. The flagship cryptocurrency is currently trading at **$98,754.01, down from its recent all-time high of $109,478**.
Market Context and Key Factors
Why the Drop Matters
- Bitcoin serves as a benchmark for broader crypto market health, and its decline has been mirrored by other major cryptocurrencies like Ethereum and XRP.
- Investor caution stems from uncertainty around U.S. monetary policy and geopolitical factors, including potential tariff adjustments.
Federal Reserve’s Role
The Federal Open Market Committee (FOMC) is expected to maintain steady interest rates, despite calls for cuts from some political quarters. President Trump recently emphasized the need for lower rates, linking economic progress to his administration’s policies.
External Pressures
- The launch of China’s AI bot DeepSeek has unsettled U.S. tech investors, with ripple effects spreading to crypto markets.
- Analysts note a "risk-off" trend, exemplified by Solana’s price drop, as global competition in AI intensifies.
Political and Regulatory Developments
- Trump’s executive order establishing a digital assets working group, chaired by AI/crypto czar David Sacks, aims to provide regulatory clarity and explore a national digital asset reserve.
- Prominent Bitcoin advocates, like JAN3 CEO Samson Mow, predict a $1 million valuation by 2025 and endorse Trump’s proposed strategic Bitcoin stockpile.
Expert Insights
James Toledano, COO of Unity Wallet, highlights concerns over the Fed’s delayed rate cuts as a potential drag on speculative assets like Bitcoin (Forbes).
FAQs
Why did Bitcoin fall below $100K?
The drop reflects pre-Fed decision jitters, AI market disruptions, and broader economic uncertainties.
Will the Fed cut interest rates?
Most analysts expect rates to hold steady, despite political pressure for reductions.
What’s the long-term outlook for Bitcoin?
Advocates remain bullish, citing institutional adoption and regulatory advancements as key growth drivers.
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Conclusion
Bitcoin’s volatility underscores its sensitivity to macroeconomic and technological shifts. While short-term dips may occur, institutional interest and regulatory support suggest sustained upward potential.