Bitcoin Plunges Below $93000 as Trumponomics Minutes Spook Market

Bitcoin’s price dropped below $93,000 on Thursday after minutes from the Federal Open Markets Committee’s December meeting showed that the Trump administration was a key factor in the Fed’s decision to begin raising interest rates.

The minutes, released on Wednesday, showed that the Fed officials were concerned about the Trump administration’s tax cuts and spending plans, which they believed would lead to higher inflation and faster economic growth.

“The Trump administration’s policies were seen as inflationary, and the Fed was responding to that,” said Peter Chung, an analyst at Presto Labs.

The Fed’s decision to raise interest rates was a blow to Bitcoin, which had rallied strongly in the lead-up to the Trump administration’s departure.

Bitcoin had hit a record high of $108,135 in November, as investors piled into the cryptocurrency amid hopes that Trump would be re-elected and his administration would continue to support cryptocurrencies.

But Bitcoin’s rally stalled after Trump lost the election, and the cryptocurrency has been trading in a range between $89,000 and $100,000 ever since.

“The market had priced in Trump’s presidency and his administration’s crypto-friendly policies, and now that’s not happening, the market is reacting,” said Min Jung, an analyst at Presto Labs.

Despite the drop, analysts still expect Bitcoin to rally in 2025.

Chung and Jung said that the market is still digesting the Trump administration’s departure and the implications of the Fed’s interest rate decision.

“A breakout will happen when the market completes its recalibration process and uncertainty clears,” they wrote in a research note.

“Signals for this will likely emerge after Trump’s January 20 inauguration and gradually take shape during his first 100 days in office. Be patient and stay tuned.”