Bitcoin has experienced its first significant weekly decline since Donald Trump’s presidential win in November sparked a massive rally. The cryptocurrency dropped 10% in the week ending December 22, closing at $94,645—down from its peak of $105,185.
Federal Reserve Actions Impact Bitcoin
The drop followed the Federal Reserve’s Federal Open Market Committee announcement. The committee reduced projected interest rate cuts for 2025 from five to two, signaling a less favorable environment for risk-on assets like Bitcoin. The federal funds rate is now expected to stabilize at 3.9% instead of the previously forecasted 3.4%.
Bitcoin’s Rally Takes a Pause
Before this decline, Bitcoin had risen in six of the last seven weeks since Trump’s election win. The only other drop occurred in late November, with a minor retrace of 0.78%. Despite this week’s pullback, industry analysts remain optimistic about Bitcoin’s future.
Pro-Crypto Administration Fuels Optimism
Trump has assembled the most crypto-friendly administration in U.S. history. Hedge fund manager Scott Bessent is nominated for Treasury Secretary, while Cantor Fitzgerald CEO Howard Lutnik is set to lead the Commerce Department. Paul Atkins, a known crypto advocate and former SEC commissioner, is slated to replace Gary Gensler as SEC chair.
These appointments could create a more favorable regulatory environment for cryptocurrency. Industry insiders are hopeful this will pave the way for further adoption and innovation.
Experts See Bitcoin’s Bright Future
Despite the recent dip, asset managers like Bitwise and VanEck project Bitcoin could surge to $180,000–$200,000 by 2025. Factors driving this optimism include potential U.S. Bitcoin reserves and increased corporate and institutional adoption.
Bitcoin currently trades around $96,073—down 11% from its all-time high of $108,135 reached on December 17. However, the trajectory remains upward compared to its $43,610 valuation last Christmas.
