Bitcoin is maintaining its position above $111,000 as the U.S. prepares to release new inflation data that could significantly influence whether the Federal Open Markets Committee opts for a second interest rate reduction in 2025.
Decrypt consulted three analysts who offered varying perspectives on how Bitcoin, the largest asset by market capitalization, might react.
Currently trading at $111,336, Bitcoin has experienced a decline of 1.8% over the past day and 5.4% since last week according to CoinGecko’s crypto price aggregator.
The sluggish performance of BTC has led users of Myriad—a prediction market under Decrypt’s parent company Dastan—to question if Bitcoin will reach $125,000 soon. As of Thursday morning, 61% believe BTC will fall to $105,000 before nearing an all-time high.
“Tomorrow’s PCE report is crucial as it serves as the Fed’s measure for inflation,” said Jake Kennis from Nansen in an interview with Decrypt. “Crypto traders should be alert for any deviation from the anticipated year-over-year reading between 2.7-2.9%. Higher-than-expected inflation may indicate more aggressive Fed policies and a risk-off sentiment that usually affects crypto markets.”
If inflation comes in cooler than expected though,it might prompt another interest rate cut potentially boosting Bitcoin and other cryptocurrencies out of their recent stagnation,Kennis noted.
Economists are predicting that core personal consumption expenditures reported by Bureau of Labor Statistics will hit around 2.99%, based on estimates from Cleveland’s Federal Reserve Bank.
The CME FedWatch Tool currently shows investors estimate an 83.4% likelihood that rates will be lowered at next month’s FOMC meeting—doubling last week’s odds which rose from just over eight percent to sixteen point six percent now
“It’s intriguing how despite anticipating high numbers,digital assets face pressure,” commented John Glover,the chief investment officer at Ledn,a Bitcoin lending firm,to Decrypt
This negative sentiment along with declining prices have triggered significant liquidations within crypto markets recently
“It appears weak long positions are being cleared out,” he mentioned referring back towards healthy market corrections observed earlier this week.”However,selling pressures between ranges like$115k-$119k suggest some profit-taking actions among those convinced we’ve reached end-of-bull-run scenarios”
Glover further speculated unless actual figures deviate considerably,PCE results may become insignificant events
Bigger picture wise,BTC outlook remains optimistic according Dom Harz—co-founder behind BOB—a decentralized finance project centered around bitcoin—in conversation w/Decrypt
“As Q3 ends,BTC holding steady above$110k not only marks pricing milestones but also reflects institutional confidence crystallizing within digital assets realm”he stated ..