The local bottom for Bitcoin on the Binance exchange appeared to be the $98,802 line this morning. That said, just the day before yesterday, the first cryptocurrency set a new all-time high of $108,353. Here’s a 15-minute chart of BTC.

15-minute chart of the Bitcoin BTC exchange rate

By the way, we have previously heard the version that the US may not create a national Bitcoin reserve. This week, such a viewpoint was voiced by the former head of the crypto exchange BitMEX Arthur Hayes.

He even suggests that the day of Donald Trump’s inauguration on 20 January will be the occasion for the collapse of the digital asset market. Still then, crypto investors will supposedly realise that the politician has no magical tools to instantly improve the situation in the economy and social spheres.

However, Hayes has been wrong with his predictions many times before. And his success rate for predictions for the year was only 25 per cent, which is also worth considering.

Will the U.S. buy bitcoins

According to The Block’s sources, Powell’s answer to the question was as follows.

We are prohibited from owning bitcoins. The Federal Reserve Act defines what we can own and we are not seeking to change the law. That is a matter for Congress to consider, but we at the Fed are not initiating such a change.

U.S. Federal Reserve Board Chairman Jerome Powell

Earlier in Congress, Senator Cynthia Lummis of Wyoming drafted a bill that would require the US Treasury Department to purchase one million BTC within five years. So far, this is just an initiative as part of Trump’s election pledge, and as such, it does not commit the Fed to any action at this point in any way.

Before the November election, Donald Trump also supported the idea of creating a strategic crypto reserve. Well, in an interview with CNBC last week, he stated the following.

We’re going to do something great with cryptocurrencies because we don’t want China or anybody else – not just China, but other countries – to get ahead of us. We have to be ahead of the curve.

Some states have also proposed bills to dedicate a portion of their local budgets to the purchase of BTC. For example, Pennsylvania Republicans introduced a bill in November that would allow a share of the state’s budget to be invested in Bitcoin, other digital assets, and crypto-based exchange-traded products.

U.S. benchmark lending rate dynamics

Prior to Wednesday’s press conference, the Federal Reserve announced a 25 basis point cut in the benchmark lending rate, marking the third consecutive rate cut. Following this, the value of Bitcoin fell by almost 5 per cent, and the collapse of most popular altcoins was even bigger.

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Zach Pandl, head of research at Grayscale, commented on the local correction. Here is his comment on the situation.

The fact that Bitcoin’s price fell after Fed Chairman Powell’s statements indicates that investors may attach too much importance to the theoretical possibility of creating a strategic reserve of BTC.

Another reason for negativity in the coin market after the Federal Open Market Committee cut the rate by 25 basis points was Powell’s remark that next year such a process will be slower. He also noted that the decision to cut rates on Wednesday was more difficult than financial markets had anticipated.

Volume of position liquidations in crypto trading

As a result, the consensus of market participants now is that at the next FOMC meeting on 29 January 2025, the benchmark interest rate will remain at its current level, i.e. unchanged. Accordingly, the easing pressure on the economy by bankers will be put on pause.

Presto Research analyst Ming Jung shared his expectations of the near-term future for the markets. Here is his quote.

As we approach Christmas and New Year, the market is likely to remain relatively quiet. There is only a month left until Trump’s inauguration. It looks like next, attention will start to shift to events surrounding the new administration and any announcements from Trump himself.


Obviously, crypto investors didn't like Jerome Powell's comment that the US Federal Reserve can't hold bitcoins. However, it is important to realise that the US will be forming separate legislation to create a national BTC reserve. Therefore, if Congress supports such an idea, coin purchases will still take place.


Look for more information about other interesting news in our crypto chat. We are waiting for you there to properly enjoy the current bullrun in the digital asset market.

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