Following Donald Trump’s re-election as President of the United States, Bitcoin 
$94,197 witnessed an unprecedented surge. Last week, the price of Bitcoin reached nearly $110,000, approaching all-time highs. However, recent fluctuations have occurred, marked by a 12% decline in prices, leading analysts to suggest that the market is in a temporary stagnation phase.
Fed’s Interest Rate Policies and the Crypto Market
The Federal Reserve’s cautious stance on interest rate cuts and President Jerome Powell’s negative remarks about Bitcoin have contributed to market volatility. Powell expressed that Bitcoin reserves could promote economic instability. These statements have resulted in a retreat from Bitcoin’s record levels, drawing close attention from market participants.
The uncertainty surrounding the Fed’s interest rate decisions has bred distrust in the markets, prompting long-term investors to take profits during this period. The encountered fluctuations have increased pressure on price movements.
ETFs and the Wave of Investment in Bitcoin
In the United States, spot Bitcoin ETFs experienced a net outflow of $948.9 million after a prolonged period of calm over the last two days. Nevertheless, ETFs continue to hold 1.139 million BTC, which corresponds to 5.425% of the total Bitcoin supply. Market analysts indicate that this outflow is a result of long-term investors liquidating their portfolios to create liquidity in the market.
Experts emphasize that the recent declines do not indicate Bitcoin’s weakness. According to Swissblock analysts, these movements signal the market’s potential for recovery. The continuation of profit-taking reinforces confidence in Bitcoin’s long-term resilience, suggesting that the market may find new direction in light of the Fed’s future interest rate decisions and economic policies.
Investor behavior and economic developments in the Bitcoin market play a significant role in shaping future strategies. Therefore, it is seen as a critical necessity for market participants to act with awareness.
