Bitcoin and Ether Slump as Powell Hints the Fed Will Slow Rate Cuts in 2025

This week's slump in the crypto market hasn't abated. Over the past 24 hours, the price of Bitcoin has dropped 7.3% to now $94,662.

Major cryptocurrencies continued to slide on Friday, extending losses seen earlier in the week after the Federal Reserve hinted at slowing interest rate cuts in 2025.

Over the past 24 hours, Bitcoin slipped 7.3% to now trade at $94,662. The world’s largest cryptocurrency by market capitalization dropped below the key $100,000 level on Thursday.

Meanwhile, Ether dropped 13% to $3,213. The token, which powers the Ethereum blockchain, also slid below a key level on Thursday, having dropped out of the $4,000 range.

Broader crypto market slumps

The flagging market was especially brutal for dominant altcoins. Solana slid 14%, Cardano dropped 18%, and XRP, the token linked to Ripple, tanked almost 13%.

The drawback continued a trend of bearish sentiment seen earlier in the week.

On Wednesday, Jerome Powell, chair of the Federal Reserve, said that interest rate cuts will slow in 2025. Bitcoin dropped in price soon after.

“The market is reacting strongly to expectation setting from the Fed on rate cuts next year,” Lennix Lai, the chief commercial officer at crypto exchange OKX, told DL News.

Still, the crypto market hovers near historic highs after Donald Trump’s win in November sparked a wave of industry optimism.

Its total value is about $3.5 trillion, which is more than double what the market was worth at the end of 2023.

Trump factor ‘priced in’

Lai nevertheless cautioned that this week’s pullback may persist in the short-term, and prices may remain volatile.

“The approaching holiday season has historically brought reduced liquidity conditions,” he said.

And, he said, Trump’s pro-crypto stance is now largely priced in.

“Traders should remain mindful that the path to institutional adoption and policy reform will likely be gradual rather than immediate,” Lai concluded, “even with potential changes in the US administration.”