Bitcoin investors are waking up to another bad morning for the world’s preeminent cryptocurrency. As of this writing, the price of one token has fallen by 6.55% over the past 24 hours to just over $95,000 per coin.
This is a low that Bitcoin has not seen since May.
Today’s sell-off continues a month-long trend in which Bitcoin has lost about 20% of its value. But what is behind this recent sell-off? Two culprits are most likely at play.
Uncertainty over Fed rate cuts
Next month, the Federal Reserve is expected to announce its decision on whether to change interest rates. The Fed has three options: raise rates, keep rates at current levels, or cut (decrease) rates.
Until recently, Wall Street was quite optimistic about the likelihood that the Fed would cut rates in December.
When the Fed cuts rates, it is generally considered beneficial because rate cuts increase market liquidity. Increased liquidity generally encourages investors to invest more in risky assets.
Risk assets include assets such as cryptocurrencies and highly volatile stocks (such as AI-adjacent stocks in recent times).
Thus, a Fed rate cut in December would increase liquidity, likely pushing investors toward risky assets, including cryptocurrencies such as Bitcoin, whose prices would likely rise.
But now, as NBC News notes, in recent days, traders think there’s only about a 50% chance the Fed will cut rates in December. In early November, the majority of traders thought there was a 90% chance the Fed would do so.
This uncertainty over whether the Fed will cut rates in December is likely one of the main factors behind Bitcoin’s fall today.
Selling Tech and Crypto Stocks
Bitcoin is generally considered a risky asset because its price is very volatile compared to more traditionally stable assets like bonds.
But Bitcoin is not the only risky asset.
Many tech stocks are considered risky assets, especially those operating in the AI space, as their prices can fluctuate significantly lately.
And since yesterday, these risky technology assets have been in free fall.
Just yesterday, the prices of some major tech and AI stocks fell significantly due to both uncertainty over Fed rate cuts and growing fears of an AI bubble. These declines yesterday included:
- Palantir Technologies Inc. (Nasdaq: PLTR): down 6.53%
- Intel Company (Nasdaq: INTC): down 5.23%
- NVIDIA Company (Nasdaq: NVDA): down 3.58%
- Tesla, Inc. (Nasdaq: TSLA): down 6.64%
- Amazon.com, Inc. (Nasdaq: AMZN): down 2.71%
- Alphabet Inc. (Nasdaq: GOOG): down 2.89%
Meanwhile, it wasn’t just traditional tech stocks that took a hit yesterday. As CoinCentral noted, crypto stocks in the mining and trading space also had a pretty bad day, including:
- Bitfarms Ltd. (Nasdaq: BITF): down 17.98%
- Bitdeer Technologies Group (Nasdaq: BTDR): down 20.3%
- Coinbase Global, Inc. (Nasdaq: COIN): down 6.86%
- Space Station Gemini, Inc. (Nasdaq: GEMI): down 9.78%
- Bullish (NYSE: BLSH): down 9.85%
When investors see a sharp decline in stocks of risky assets – particularly those operating in the crypto space – this can lead to an outflow of investing in cryptocurrencies themselves as they look for safer, more stable investment assets in which to place their money.
Bitcoin had a chaotic 2025
Being an investor in Bitcoin has certainly had its ups and downs this year. The token started trading just above $94,000 per coin just after the new year. It received a boost from the crypto-friendly Trump administration around the time of President Trump’s inauguration later in the month.
But after trading above six figures in the first months of the year, Bitcoin took a hit, along with most of the stock market, thanks to President Trump’s Liberation Day tariffs, which injected more uncertainty into investors’ minds than they had experienced in a long time.
By April, Bitcoin had fallen to just above $76,000.
However, the crypto has recovered well since then, rising steadily until reaching an all-time high of over $126,000 in October. But since then, Bitcoin has continued to decline.
And after its recent plunge, Bitcoin is only up about 2.8% for the year.
The early bird deadline for Fast Company’s World Changing Ideas Awards is Friday, November 14 at 11:59 p.m. PT. Apply today.
