Bitcoin Faces First Weekly Decline Since Trump’s Election Victory
Bitcoin is on track for its first weekly drop since Donald Trump’s victory in last month’s U.S. presidential election. The cautious monetary policy outlook from the Federal Reserve has tempered the optimism sparked by Trump’s apparent embrace of the cryptocurrency sector.
The largest digital asset experienced a decline of over 7% for the seven-day period ending at 2:50 p.m. on Sunday in New York, marking its biggest drop since September. The broader cryptocurrency market, which includes smaller tokens like Ether and Dogecoin, saw an even steeper fall of about 10%.
The Federal Reserve’s announcement on Wednesday of its third consecutive interest-rate cut, combined with indications of a slower pace of easing in 2024, sent ripples through global markets. Stocks took a hit, and the hawkish stance curbed the speculative rally in crypto markets fueled by Trump’s pro-crypto regulatory stance and his proposed national Bitcoin stockpile.
Bitcoin was trading at approximately $95,000, about $13,000 below its all-time high reached on December 17. Despite the current decline, the cryptocurrency remains up by over 40% since the U.S. election on November 5.
David Lawant, head of research at FalconX, predicts short-term price fluctuations but anticipates a “bullish trajectory” heading into the first quarter of 2025. In a recent note, Lawant emphasized that the low-liquidity environment could increase volatility as the year draws to a close, particularly with the record-setting crypto options expiry expected on December 27.
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