Bitcoin and Crypto Markets React to Federal Reserve's Hawkish Stance

Bitcoin Faces Volatility Amid Fed's Stance

Bitcoin experienced a slight decline on Monday, continuing its descent from last week's losses. Traders are cautious due to macroeconomic pressures stemming from the Federal Reserve's hawkish comments. The cryptocurrency dropped 0.7%, trading below the $100,000 threshold. This decline follows the Federal Reserve's announcement of a more conservative approach to interest rate cuts, which has prompted investors to reassess riskier assets like Bitcoin.

Impact of Federal Reserve's Policy Shift

The Federal Reserve's indication of only two interest rate cuts for the upcoming year has led to a reevaluation of speculative investments, contributing to Bitcoin's recent price drop. Profit-taking further contributed to the decline after Bitcoin hit an all-time high earlier in the week. This marks Bitcoin's first weekly drop since the election victory of Donald Trump.

Trump Administration's Crypto Policy Moves

President-elect Donald Trump has made significant nominations for his new administration, impacting the crypto policy landscape. Michael Kratsios has been appointed to lead the Office of Science and Technology Policy, while Lynne Parker and Bo Hines will head key crypto-focused councils. These appointments signal a strategic focus on cryptocurrency, with David Sacks serving as the "crypto czar."

Mixed Reactions in Altcoin Markets

The broader cryptocurrency market remained subdued, with many altcoins mirroring Bitcoin's trend due to lingering liquidity concerns. Ether and XRP saw declines, while Solana, Polygon, and Cardano experienced modest gains. Notably, Dogecoin rose slightly among meme tokens. Investors continue to assess the outlook for speculative assets amid the ongoing market uncertainty driven by the Federal Reserve's stance.