Cryptocurrency prices are falling after the U.S. Federal Reserve signalled that it is only likely to lower interest rates twice in 2025.
Dogecoin (DOGE) is leading crypto majors lower, having fallen 11% in the past 24 hours. Losses in Bitcoin (BTC) and other cryptos have extended to three consecutive days.
Bitcoin has dropped 4% in the past 24 hours to trade at $94,400 U.S. Solana (SOL), Ethereum (ETH) and Cardano (ADA) have each declined 9% in a day.
Dogecoin has now declined more than 20% in the past week. Cryptocurrencies trade 24 hours a day, seven days a week.
The drop in prices comes amid risk-off behavior among investors and year-end profit-taking, say analysts.
The selloff has accelerated after the U.S. Federal Reserve struck a more hawkish tone on inflation and future interest rate cuts, saying fewer rate reductions should be expected next year.
Fed Chair Jerome Powell also threw cold water on president-elect Donald Trump’s plan to create a strategic Bitcoin reserve, saying the central bank wasn’t allowed to own crypto under current regulations.
The current decline in Bitcoin comes amid a typically bullish time of year for the digital asset.
December tends to be historically bullish for Bitcoin and crypto tends to benefit from the
year-end "Santa Claus Rally."
Data from the recent past shows that Bitcoin ended December up six times since 2015, with gains of 8% to as much as 46%.
Bitcoin has risen 113% so far in 2024.
