Bitcoin Faces 20% Drop as Fed Cuts Loom!

Bitfinex analysts predict a 15-20% decline in BTC's price if the Fed cuts rates in September.

Author

Danielle du Toit
September 04, 2024

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  • US Fed Rate Cut Could Push Bitcoin Down 20% - Analysts

  • John Deaton Wins Republican Primary Race to Battle Warren in Nov.

  • Bitcoin price Drops 10% as Macro Concerns and Miner Struggles Persist

  • US Spot Bitcoin ETFs See $287 Million in Net Outflows, Largest Negative Flows Since May

✂️ US Fed Rate Cut Could Push Bitcoin Down 20% - Analysts

Analysts predict that a United States Federal Reserve interest rate cut could push the price of Bitcoin down.

  • Bitfinex analysts predict a 15-20% decline in Bitcoin's price if the Fed cuts rates in September, with a potential bottom around $40-50k.

  • The analysts pointed out that September is quite a historically volatile month for Bitcoin, which could be worsened by a rate cut.

  • The Fed's interest rate decision is expected on Sept. 18, and is expected to lower rates after dovish comments from Chair Jerome Powell in August.

Deaton will face off against anti-crypto Elizabeth Warren in the November elections.

  • John Deaton won the Republican primary race by defeating Bob Antonellis and Ian Cain.

  • Deaton's campaign received a lot of support from a few well known people in the crypto industry, like the Winklevoss twins, Ripple executives, and Anthony Scaramucci.

  • Despite his strong crypto connections, Deaton did not specifically mention cryptocurrency in his victory speech that he shared on social media.

Bitcoin's price dropped 10% over 10 days, driven by macroeconomic uncertainties.

  • Bitcoin's decline contrasts with the stability of other major financial indicators like the S&P 500, which is 2% below its all-time high, and gold.

  • The drop in BTC's price is partly driven by concerns about the broader macroeconomic environment, particularly in the U.S. and fears of a potential recession.

  • These recession fears are starting to stabilize, and the focus is shifting more to monetary policy and the performance of the US dollar.

On Tuesday, spot Bitcoin ETFs in the U.S. recorded $287.78 million in net outflows.

  • BlackRock's IBIT, the largest spot Bitcoin ETF, recorded zero flows for the day.

  • Grayscale's GBTC saw outflows of $50.39 million, while Fidelity's FBTC had the largest outflows at $162.26 million.

  • Other spot Bitcoin ETFs, including those from Ark, 21Shares, Bitwise, and VanEck, also experienced modest outflows, with total trading volumes reaching $1.56 billion on Tuesday.

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