Bitcoin Stability During 2025 Fed Rate Changes

by Muntaha Nadeem

Bitcoin (BTC) trading between $90,000 and $90,000, indicating its continued price stability, so market stability is still an important topic. The Federal Open Market Committee (FOMC) meeting on December 18 caused slight declines in global stock market indexes.

Bitcoin Against Market Trends

The US Federal Reserve (Fed) raised interest rates monthly for over a year. Interest rates were cut by 50 basis points in September. People became more optimistic about cryptocurrency and stocks. They expected the government would loosen monetary policy, benefiting risky assets and boosting stock and cryptocurrency markets.

However, K33 Research found that the December 18 Federal Open Market Committee meeting raised concerns about repeating rate cuts. This is because Federal Reserve Chairman Jerome Powell announced slower monetary easing in 2025.

Bitcoin Against Market Trends

The Federal Reserve paused interest rate decreases for numerous reasons, including Trump’s rule may raise prices. Because of this, the S&P 500, a stock market index that tracks 500 of the largest US-listed companies, has fallen 2.55% in the past month. Bitcoin has performed well despite declining stock prices, proving it is a new asset class.

Leading cryptocurrencies see 20%

Vetle Lunde, Head of Research at K33 Research, said the December 18 Federal Open Market Committee meeting prompted the latest decline. Bitcoin’s 11% loss is substantial, but not given its prior history. Leading cryptocurrencies often see 20%–30% pullbacks during bull runs.

Alternative cryptocurrencies often fall considerably more before recovering. Lunde also noted that Bitcoin’s 30-day Nasdaq link exceeded 0.5 for the first time since September. Due to this closer relationship, Bitcoin is becoming more like ke tech-heavy stock market.

BTC Price Drop Forecast

The market’s concern about inflation has been reflected in the 100-basis-point increase in the 10-year Treasury rate since September, which the Fed has also dropped. The present decline in BTC prices lends credence to crypto entrepreneur Arthur Hayes’ prediction of a big fall around Trump’s inauguration; on-chain research suggests that BTC may quickly fall to $80,000. Nevertheless, industry insiders continue to maintain Bitcoin’s optimistic long-term prognosis. As of press time, BTC was $94,805, up 2.6% in 24 hours.

Vetle Lunde of K33 Research says Bitcoin’s 11% drop matches its bull run. Bitcoin’s 30-day correlation with the Nasdaq exceeded 0.5 for the first time since September, signalling greater ties to technology-driven markets. Inflation-conscious bitcoin pioneer Arthur Hayes predicted a drop to $80,000 near Trump’s inauguration. Bitcoin’s long-term prospects are strong, demonstrating its resilience as a unique asset class.

Summary

As global stock market indices fell after the December 18 FOMC meeting, bitcoin market steadiness stood out. Despite market trends, Bitcoin (BTC) held strong. The Fed has gradually cut interest rates to loosen monetary policy since September. Federal Reserve Chair Jerome Powell said monetary easing will be slower, aiming until 2025. Rate cuts and inflation worries sent the S&P 500 down 2.55% last month. Bitcoin maintained its 2.6% daily rise between $90,000 and $94,805 despite these issues.

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