First Time In Three Months, Bitcoin Falls Below $25,000 Level

As the Federal Reserve held off on raising interest rates, the price of Bitcoin fell by 4%.

Source: coin-turk.com

Following a hawkish Fed pronouncement in the midst of yet another volatile week for the cryptocurrency sector, the price of Bitcoin has dropped below the $25,000 threshold for the first time since March 17.  Data from TradingView shows that the price of Bitcoin dropped 4% from $25,867 to $24,819 in a 30-minute period on June 15. When this article was written, Bitcoin had gained some ground and was holding steady slightly around $25,000. Bitcoin has been holding steady at approximately $26,000 over the past week as the market adjusted to the SEC's legal action against prominent cryptocurrency exchanges Coinbase and Binance, as well as growing macroeconomic uncertainties surrounding interest rate signals from the US Federal Reserve.

Bitcoin price. Source: TradingView

After a fifteen-month campaign of rate rises to battle rising inflation, the Federal Reserve declared a pause on rate hikes and the sudden price reduction happened around three hours later. Although the Federal Open Market Committee's statement hinted at potential future rate increases, the market was nearly universally anticipating a rate pause. This often dampens investor enthusiasm for risky assets like cryptocurrencies. Federal Reserve chairman Jerome Powell has made it quite obvious that this is simply a temporary halt, which might cause more problems for Bitcoin in the long run, said eToro Market Analyst Josh Gilbert. 

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Ether, the second-largest cryptocurrency by market size, also suffered losses, sliding over five percent from $1,727 to $1,631 during the same time period. The gloomy attitude also affected altcoins, with several of the tokens classified as securities in the SEC's litigation falling by more than 3%. The current options data for Bitcoin, stated by Cointelegraph analyst Marcel Pechman, point to a further decline to the downside, especially when taking into account the regulatory dislike towards the crypto industry on American soil as well as the likelihood of additional rate increases from the Fed in the upcoming months.

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