Bitcoin (BTC) Market Hangs by a Thread, Waiting for Jerome Powell's Next Decision

The crypto market is once again in a state of uncertainty, hanging on a single question: what will be the next decision of the U.S. Federal Reserve?

The crypto market is once again in a critical state of uncertainty,pivoting on a single point: the next decision of the U.S. Federal Reserve.

As bitcoin hovers below $85,000 and the market’s fear and greed index collapses to 23, investors are holding their breath. The meeting of the Federal Open Market Committee (FOMC) concludes today, and all attention is now on Jerome Powell.

Markets Under Pressure Await the Fed’s Verdict

For several days, bitcoin and major cryptos have displayed increased volatility, signaling a rising nervousness.

This morning, bitcoin dropped below $83,000, before slightly rebounding to $83,450, while Ethereum, Solana, and XRP are juggling between small gains and losses.

Ryan Lee, chief analyst at Bitget Research, sheds light on this dynamic, stating that:

Bitcoin price dropped by 0.2% to trade around $83,000 on Wednesday, continuing a broader decline in the crypto market. Solana, XRP, and Dogecoin are also down, while gold price rose above $3,000 an ounce and markets awaited the FOMC decision on March 19, 2025. Although bitcoin has historically been correlated with gold as a macroeconomic hedge, their current divergence (bitcoin falling while gold rises) indicates that bitcoin is acting more like a risk asset, reacting to uncertainty over Fed monetary policy, crypto market profit-taking, and a corresponding market flow toward traditional safe havens. The outcome of the FOMC meeting could favor a rebound if the tone is flexible or intensify the correction if the position remains restrictive, with the short-term trend of bitcoin now being more closely linked to global economic signals than its role as digital gold.

The pivotal element that has investors on edge is the stance the Federal Reserve will take on interest rates.

Officially, the predictions are for rates to remain within the band of 4.25% to 4.5%. However, the key factor will be the tone of Jerome Powell’s speech.

Three possible scenarios are being considered by investors:

“We do not anticipate an immediate rate cut,” has already been stated by the Fed chairman in recent months. He highlights the persistence of inflation and the still fragile state of the economy.

Yet, even a slight variation in his tone would be enough to trigger an immediate reaction in the markets.

Investors are scanning every hint for a sign of a shift in the Fed’s course.

A Crypto Market at a Crossroads

If the Fed maintains a hard and restrictive position, the market could face another downturn, as investors would then be turning towards safer investments like bonds.

Many analysts are fearing a tightening of liquidity, which would particularly impact risk assets like bitcoin.

“Financial flows are beginning to shift towards European and Asian markets,” notes a report by QCP Capital, suggesting a movement of capital away from U.S. tech stocks and cryptocurrencies.

Conversely, if Powell hints at a possibility of monetary easing sooner than anticipated, the crypto market could react swiftly with a spectacular rebound.

The recent drop in the Consumer Price Index (CPI) from 3.1% to 2.8% could serve as an argument for an upcoming easing. If the Fed hints that rate cuts might start before mid-2025, bitcoin and altcoins would stand to benefit directly, which would in turn attract investors seeking high returns.

The coming hours will be decisive as Jerome Powell’s speech will condition the market movements, and the magnitudes of the reactions could be significant. A conciliatory approach would open the door for a new bullish dynamic and strengthen interest in cryptocurrencies as a safe haven in anticipation of an economic stimulus. Conversely, a hard and unyielding line could mark the beginning of a new correction phase, testing the markets’ resilience against an inflexible monetary policy.

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Diplômé de Sciences Po Toulouse et titulaire d'une certification consultant blockchain délivrée par Alyra, j'ai rejoint l'aventure Cointribune en 2019. Convaincu du potentiel de la blockchain pour transformer de nombreux secteurs de l'économie, j'ai pris l'engagement de sensibiliser et d'informer le grand public sur cet écosystème en constante évolution. Mon objectif est de permettre à chacun de mieux comprendre la blockchain et de saisir les opportunités qu'elle offre. J'efforce chaque jour de fournir une analyse objective de l'actualité, de décrypter les tendances du marché, de relayer les dernières innovations technologiques et de mettre en perspective les enjeux économiques et sociétaux de cette révolution en marche.