Bitcoin rebounds slightly after $100,000 collapse… Powell’s remarks

After the announcement of the Federal Reserve (Fed) to lower the benchmark interest rate, the price of BTC plummeted below $100,000 and then rebounded slightly. This is interpreted as the Fed, which is expected to adjust the pace of interest rate cuts next year, has drawn the line on the BTC stockpiling plan.

At 11:30 am on the 19th, BTC was traded at $99,047, down 6% from the previous day, on CoinMarketCap. It was the first time BTC had fallen below $100,000 since the 14th. The second-largest virtual asset ETH also recorded $4,010, down 10.8% over the same period. However, BTC prices rebounded slightly from this afternoon and settled back around the $100,000 level.



The background for the decline in virtual asset prices is the Fed's outlook for a rate cut next year. According to CoinTelegraph, the Fed lowered the benchmark interest rate by 0.25 percentage points this morning and forecast the benchmark interest rate to be around 3.9% by the end of next year. This means that the Fed may cut rates twice out of the eight Federal Open Market Committee (FOMC) meetings scheduled for next year. Considering that the Fed forecast "four rate cuts next year" in September, it seems that the Fed intends to slow the pace of rate cuts.

Jerome Powell, the chairman of the Fed, also had an impact with his remarks on BTC. The incoming Donald Trump administration is expected to pursue a plan to strategically stockpile BTC. However, Chairman Powell stated at a press conference after the FOMC that "(the central bank) cannot own BTC. (The establishment of a system for BTC stockpiling) is a matter for Congress to consider, and the Fed has no plans to pursue legislative changes."

Jae-heon Choi, Reporter

chsn12@decenter.kr