Bitcoin Failed to Stay Above $100,000! Here are the Factors That Triggered the Drop!

Bitcoin and Ethereum, two of the largest cryptocurrencies, experienced sharp drops today due to long-term inflation fears weighing on global markets.

Bitcoin and Ethereum Prices Fall Between Inflation Concerns and Market Volatility

Bitcoin (BTC): After briefly surpassing the $100,000 mark earlier this week, it fell 5% and traded at $96,527. Please provide the text to be translated Ethereum (ETH): It reached $3,314, a decrease of 8.5% in the last 24 hours.

Other Cryptocurrencies: Large tokens such as Dogecoin (DOGE) and Avalanche (AVAX) have seen losses exceeding 10%.

Macro Fears Triggered a Market Pullback

The decline is following macroeconomic signals indicating persistent inflation and tighter monetary policies.

Stock Market Impact: US stocks also experienced a decline, with NASDAQ and S&P 500 showing a drop of more than 1% on Tuesday.

Inflation Concerns: Faster-than-expected growth of the US economy according to ISM data has exacerbated long-standing inflation concerns.

Bond Yields Rose: The yield of 10-year Treasury bonds rose to its highest level since April, reflecting investors' concerns.

At Presto Research, analyst Min Jung said, "Both the crypto and traditional markets are reacting to the Federal Reserve's decision to sustain high interest rates combined with inflation fears for a longer period."

Federal Reserve and Market Sensitivity

Federal Reserve Chairman Jerome Powell's comments in December indicated a resolute approach to inflation control, reducing hopes for a recent interest rate cut.

According to the CME FedWatch Tool, analysts expect the Fed to keep the target interest rate between 4.25% and 4.5% at its meeting on January 29.

Rachael Lucas, a cryptocurrency analyst at BTC Markets, said, "Jerome Powell's comments in December, combined with stronger-than-expected US economic data, increased market anxiety and led to increased volatility in both crypto and traditional asset classes."

The Inauguration Ceremony of Trump Holds Great Significance

The inauguration of President-elect Donald Trump on January 20 is increasing uncertainty in the market.

Analysts suggest that the crypto-friendly administration of Trump, with important appointments such as Scott Bessent as Treasury Secretary and Elon Musk as advisor, could indicate a change in US economic and cryptocurrency policies.