Bitcoin (BTC) faced volatility on Wednesday, erasing much of the gains from a brief bounce following the Fed’s rate cut announcement. Federal Reserve Chair Jerome Powell attempted to strike a balance between two contrasting scenarios, acknowledging that the labor market was weaker than previously thought, while also sounding cautious about inflation.
The Federal Reserve’s Federal Open Market Committee (FOMC) cut benchmark interest rates by 25 basis points. Markets initially reacted positively, but sentiment shifted as the market retreated amid sector-wide weakness.
Federal Reserve Announces Expected Rate Cut
The US Federal Reserve cut its benchmark interest rate by 25 basis points to the range of 3.50% to 3.75%. The cut comes amid a weakening job market and elevated inflation levels. The FOMC released an official statement that read,
“In support of its goals and in light of the shift in the balance of risks, the Committee decided to lower the target range for the federal funds rate by 1/4 percentage point to 3-1/2 to 3‑3/4 per cent.”
The December rate cut is the third consecutive cut since September, and comes amid a challenging time for the US economy. The Fed, under Jerome Powell, is looking to strike a delicate balance between stabilizing prices and a weakening job market. The Fed stated following its October rate cut that it will assess economic data to gauge the outlook and understand the interest rate trajectory.
Gemini Secures Prediction Market Approval
Gemini has secured CFTC approval for a Designated Contract Market (DCM) license, allowing it to run regulated prediction markets. Gemini announced that its affiliate, Gemini Titan LLC, received a DCM license from the Commodity Futures Trading Commission, allowing it to offer event-based contracts to US customers. The license allows users to trade yes-or-no markets tied to futures outcomes like whether prices will reach a specific level or whether corporate and political events will occur.
Gemini CEO Tyler Winklevoss said the decision was a shift towards a more supportive regulatory stance. The exchange’s President, Cameron Winklevoss, stated that the CFTC, under its current leadership, has enabled US firms to compete in the rapidly growing overseas prediction market.
Asian HNWIs Plan To Increase Crypto Exposure
A survey has revealed that over half of wealthy Asian investors plan to increase their portfolio’s exposure to crypto over the next few years. According to Sygnam’s APAC HNWI Report 2025, six out of ten Asian high-net-worth individuals (HNWIs) were willing to increase crypto allocations. The survey questioned over 270 HNWIs with over $1 million in investible assets, along with professional investors across the APAC countries. The survey revealed that over 90% of HNWIs view digital assets as “crucial for long-term wealth preservation and legacy planning, not purely speculation.” Gerald Goh, Sygnum co-founder and APAC CEO, stated,
“Digital assets are now firmly embedded within APAC’s private wealth ecosystem. Despite near-term macro uncertainty, we continue to see accelerating adoption driven by strategic portfolio diversification, intergenerational wealth planning, and demand for institutional-grade products.”
The survey also revealed that 87% of Asian HNWIs surveyed already hold crypto, with around half allocating over 10% to the asset class. A further 87% said they would ask their private banks to add crypto services through regulated partners.
Strategy Is Being Punished For Holding Bitcoin (BTC): Phong Le
Strategy CEO Phong Le has hit out against the MSCI Index’s proposal to exclude companies holding over 50% of their assets in crypto. Le argued such a move would be like removing energy giants like Chevron from an index for holding oil.
The MSCI Index announced in October that it was consulting the investor community about excluding Bitcoin and other digital asset companies that hold over 50% of their balance sheet in crypto. During an interview with the Schwab Network, Le called MSCI’s stance “misinformed and misguided.” The Strategy CEO argued that oil giant Chevron holds over half of its assets in oil, and timberland company Weyerhaeuser holds a substantial portion of its assets in wood, and neither was facing exclusion.
“It seems very early to pick winners and choosers and stifle innovation in a category like this. This would be like in the 1980s, saying the telecom company shouldn’t have built out cell towers and spectrum, or three years ago, saying AI companies shouldn’t be investing in LL labs and high-performance compute.” Phong Le
Le also called MSCI’s characterization of Strategy as a fund rather than an operating company a mistake. The MSCI, in its proposal, cited feedback that digital asset treasuries can exhibit characteristics similar to funds, which are ineligible for index inclusion. Le added,
“I’ve been CFO since 2015. Michael Saylor founded the company in 1989. We’ve been public since 1998, I work here day to day, and we are 100% an operating company legally from a corporate structure.”
Bitcoin (BTC) Price Analysis
Bitcoin (BTC) registered a brief rebound after Fed Chair Jerome Powell announced a widely expected 0.25 bps rate cut. However, volatility returned to the market, wiping out most of the post-rate cut gains. The flagship cryptocurrency reached an intraday high of $94,500 after Powell highlighted the possibility of a weaker-than-expected labor market. However, sentiment turned after he highlighted inflation was still above acceptable levels.
Powell added that Fed policy was “within a range of plausible estimates” and is well positioned to determine when and how much additional estimates are needed.
“We’re well positioned to wait and see [about further rate cuts].”
Powell also added that the Federal Reserve will have significantly more data before the January FOMC meeting, which will influence how it moves forward. Meanwhile, the New York Fed announced it will purchase short-term Treasury bills and Treasury securities with remaining maturities of up to three years if needed, targeting around $40 billion in purchases over the next month.
Daniela Hathorn, senior market analyst at Capital.com, stated that the Fed is clear that the cut is not the beginning of an aggressive easing cycle, emphasizing that future decisions will be based on inflation and labor market data.
“The Fed made clear that this cut does not mark the start of an aggressive easing cycle, with emphasis on the fact that future moves will depend heavily on incoming inflation and labour-market data.”
Goldman Sachs believes inflation will decline to 2.34% by December 2026, and predicted two rate cuts in 2026 (March and June). However, CME Group believes the Federal Reserve will not cut interest rates until June.
Looking at the four-hour chart, we can see Bitcoin forming a textbook double bottom formation around $83,000, indicating a potential trend reversal. The flagship cryptocurrency still faces resistance around $94,000, with sellers looking to drive the price below $90,000. If the price slips below $90,000, it could jeopardize the attempted breakout and drive BTC towards the $83,000 demand level.
BTC started the month in the red, dropping to a low of $83,800 before settling at $86,282. The price recovered on Tuesday, rising nearly 6% to reclaim $90,000 and settle at $91,308. Buyers retained control on Wednesday as BTC rose 2.35% to $93,453. However, it lost momentum on Thursday, dropping 1.46% to $92,093. Selling pressure intensified on Friday as BTC fell almost 3%, slipping below $90,000 to $89,345.
Source: TradingView
BTC started the weekend with a marginal decline on Saturday. Volatility returned on Sunday, reaching an intraday high of $91,779, dropping to an intraday low of $87,733, before reclaiming $90,000 and moving to $90,402. Buyers retained control on Monday as the price reached an intraday high of $92,291 before settling at $90,653. Bullish sentiment intensified on Tuesday as BTC rose 2.25% to $92,690. The price reached an intraday high of $94,500 on Wednesday but lost momentum after reaching this level and settled at $92,035. The flagship cryptocurrency is down almost 2% during the ongoing session, trading around $90,301.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
