Bitcoin market stability remains a key topic as the Federal Open Market Committee (FOMC) meeting on December 18 caused slight declines in global stock market indexes. The Federal Open Market Committee (FOMC) meeting on December 18 slightly reduced the value of global stock market indexes. When we published this article, Bitcoin (BTC) traded between $90,000 and $90,000, indicating its continued price stability.
Bitcoin Defies Market Trends
Every month for more than a year, the Federal Reserve (Fed) of the United States of America increased interest rates. They began reducing interest rates by fifty basis points in September. As a result, people were more hopeful about the cryptocurrency and stock markets. They believed the government would ease monetary policy, which would benefit risky assets, leading to an advance in the stock and cryptocurrency markets. Nevertheless, according to research by K33 Research, the Federal Open Market Committee meeting on December 18 aroused some worries about a recurring rate reduction.
This is because Jerome Powell, the head of the Federal Reserve, announced that monetary easing would occur more gradually in 2025. The Federal Reserve decided to pause on interest rate decreases for several reasons, the primary one being that Trump’s rule might result in higher pricing. Because of this, the S&P 500, a stock market index that examines the performance of 500 of the largest firms listed in the United States, has decreased 2.55% over the last month.
Even though stock prices have been falling, Bitcoin has been doing well, demonstrating that it represents a new asset class. In response to the news, Vetle Lunde, Head of Research at K33 Research, stated that the Federal Open Market Committee meeting on December 18 caused the most recent drop. Even though an 11% drop in Bitcoin price is significant, it is not that significant given its past performance. It is common for the leading cryptocurrency to see pullbacks of twenty percent to thirty percent during bull runs.
Alternate cryptocurrencies often experience even more significant declines before beginning to recover. Lunde also reported that Bitcoin’s 30-day link with the Nasdaq had surpassed 0.5 for the first time since September. This closer connection between the two is causing Bitcoin to evolve more like traditional stock markets, which heavily rely on technology.
BTC Price Drop Prediction
Since September, the Fed has dropped interest rates by 100 basis points, yet markets worry about inflation. The 100-basis-point 10-year Treasury rate increase shows this anxiety. The current drop in BTC prices supports crypto entrepreneur Arthur Hayes’ prediction of a significant drop around Trump’s inauguration. According to on-chain research, BTC may rapidly fall to $80,000.Despite this, industry insiders maintain Bitcoin’s long-term optimistic prognosis. BTC was $94,805 at press time, up 2.6% in 24 hours.
Related: Bitcoin Annual Return Predictions Through MicroStrategy Poll
Summary
Bitcoin market stability stood out as global stock market indices dropped slightly after the Federal Open Market Committee (FOMC) meeting on December 18. However, Bitcoin (BTC) remained strong despite general market trends. Since September, the Federal Reserve has progressively lowered interest rates to ease monetary policy. However, Federal Reserve Chair Jerome Powell said that monetary easing will go more slowly, with an aim of 2025.
The S&P 500 fell 2.55% during the previous month due to worries about rate cuts and inflation. Bitcoin showed consistency despite these difficulties, moving between $90,000 and $94,805, gaining 2.6% daily. Bitcoin’s 11% decline is in line with its past bull-run performance, according to Vetle Lunde of K33 Research. Additionally, Bitcoin’s 30-day correlation with the Nasdaq exceeded 0.5 for the first time since September, suggesting closer linkages to conventional markets powered by technology.
Concerned about inflation, cryptocurrency pioneer Arthur Hayes forecasted a possible decline to $80,000 close to Trump’s inauguration. However, Bitcoin’s long-term prospects are bright, underscoring its exceptional resiliency as a separate asset class.
