Will Fed Rate Cut and Political Shifts Propel Bitcoin Past $100K?

Bitcoin is currently facing strong resistance around the $100,000 mark, but many in the crypto market are optimistic that a potential Federal Reserve rate cut in December could provide the momentum needed to break through.

According to the CME FedWatch tool, there is a 72.5% chance of a 25 basis point rate cut, which could push interest rates down to between 4.25% and 4.5%. Historically, such rate cuts have been positive for Bitcoin and the broader crypto market, as they inject liquidity and boost investor confidence.

At present, Bitcoin is hovering near $94,000, having encountered multiple rejections at the $100,000 level. Institutional interest remains robust, with entities like MicroStrategy continuing their Bitcoin accumulation strategy. Additionally, Bitcoin ETFs are seeing rising inflows, with BlackRock’s IBIT leading the way with a significant $338.3 million contribution in just one day. This growing institutional involvement signals sustained confidence in Bitcoin’s long-term potential.

Meanwhile, Federal Reserve officials have hinted that a rate cut could be on the horizon. Fed Governor Christopher Waller expressed support for a cut during a recent meeting, while New York Fed President John Williams stated that he expects rates to decrease “over time.” These comments have fueled further optimism in the market, with the likelihood of a rate cut increasing.

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In the broader political landscape, the incoming U.S. President, Donald Trump, has been signaling a pro-crypto stance. Trump has appointed crypto-friendly lawmakers and is reportedly planning to create a “crypto czar” position within the White House, which has further fueled market optimism about favorable regulatory changes for the crypto industry. With these factors in play, many investors are hopeful that both the Fed’s actions and political developments will drive the next phase of growth in the crypto market.

Alexander Zdravkov