Bitcoin Retreats Amid Economic Uncertainty and Crypto Market Volatility

Bitcoin Declines as Economic Uncertainty Weighs on Crypto Markets

Bitcoin dipped 1.7% to $84,424.5 on Friday, tracking broader market declines as uncertainty over U.S. interest rates and trade tariffs dampened risk appetite. The cryptocurrency fell in tandem with Wall Street, where investors scaled back bets on near-term Federal Reserve rate cuts following the central bank's decision to keep rates steady. The Fed's forecast of higher inflation and sluggish growth in 2025, coupled with concerns over President Trump's tariff policies, further exacerbated economic uncertainty.

Altcoins See Short-Lived Rebound Before Retreat

The broader crypto market also retreated, with Ether falling below $2,000 after a brief recovery earlier in the week. XRP, which had gained 0.8% following the SEC's decision to drop its case against Ripple, traded well below its recent two-week high. Other altcoins, including Cardano, Solana, and Polygon, posted declines of 1.6%, 4.5%, and 3.1%, respectively. Meme tokens also suffered losses, with Dogecoin shedding 2.9% and $TRUMP falling 3%.

Economic Headwinds Impact Crypto Sentiment

The crypto market's struggles reflect heightened economic uncertainty, as speculative assets tend to underperform during times of economic strife. President Trump's tariff threats and the Federal Reserve's cautious stance on rate cuts have further dampened investor confidence. Despite crypto-friendly measures from the Trump administration, including the SEC's pro-crypto leadership changes, enthusiasm remains muted as traders navigate a volatile landscape.