Bitcoin’s Wild Ride: A 9.1% Plunge and the Fading Fed Rate Cut Hopes
Bitcoin’s journey took a dramatic turn on Friday, plummeting over 9.1% and continuing its downward spiral. The primary reason? Dwindling expectations of a US Federal Reserve interest rate reduction, coupled with growing concerns about technology sector overvaluation, dealt a severe blow to the digital currency.
As of Friday, Bitcoin traded at $83,790, a far cry from its April high of $90,000. CoinMarketCap’s statistics paint a grim picture, with the global cryptocurrency market, including Bitcoin, contracting by 8.5% in the last 24 hours, now valued at $2.87 trillion. Bitcoin’s market capitalization took a 9.1% hit, dropping to $1.67 trillion, while daily transaction volume surged to $113.4 billion, a 40% increase.
Bitcoin’s weekly losses as of Friday stood at a staggering 13.8%, and it has completely wiped out its year-to-date profits, declining by 10.3% so far in 2025. Ethereum, the second-largest cryptocurrency, wasn’t spared either, dropping 10.4% to $2,710.
But here’s where it gets controversial: the crypto markets worldwide took a severe hit due to monetary policy uncertainty and the fading hopes of a December rate cut by the US Federal Reserve. The release of stronger-than-expected US employment statistics on Thursday, following the federal government shutdown, has market analysts predicting that the Fed might maintain the existing policy rate at its next meeting.
According to CME FedWatch data, traders’ expectations for a 25-basis-point cut in December have dropped to 32.9% on Friday, a significant decrease from the 63.8% probability a week ago.
So, what does this mean for the future of Bitcoin and the crypto market? Will the Fed’s decision impact the digital asset’s recovery? These are questions that investors and enthusiasts alike are grappling with. What are your thoughts on this crypto conundrum? Feel free to share your insights and predictions in the comments below!