Ah, Bitcoin. That volatile rollercoaster of virtual gold that everyone loves to hate. Thanks to the political circus in the U.S. (hello, President Trump), Bitcoin has been on a wild ride. In fact, it skyrocketed by a staggering 37.4% in November 2024, just after the Donald waved his magic presidential wand. How charming.
But 2025, my friends, has been a different beast entirely. Initially, Bitcoin surged a modest 9.54%, like a kid finding his first bike, then promptly plummeted in February and March—down 17.5% and 2.19% respectively. But wait, don’t lose hope! April brought a glimmer of optimism, with a tiny rebound of 14.2%. Now, in May, Bitcoin has risen a whopping 0.38%. You know, just a casual Monday morning gain.
Three things that could prevent a new Bitcoin ATH.
Thing 2: The Fed. The market has already priced in approximately three rate cuts for the remainder of 2025, a key assumption embedded in current asset valuations—including Bitcoin. Risk assets have rallied on the expectation…
— Timothy Peterson (@nsquaredvalue) May 4, 2025
Ah, Timothy Peterson, the crypto analyst who’s been doing his best to rain on Bitcoin’s parade. He warns that Bitcoin’s rally could be in peril, and, well, who could blame him? With investor sentiment lower than a snail in a deep hole and the Federal Reserve playing games with interest rates, there’s more uncertainty in the air than a squirrel in a power plant.
Why is Bitcoin’s ATH (All-Time High) at Risk? Oh, Let Me Count the Ways
Peterson explains that Bitcoin’s growth could stall if the market just doesn’t feel like it. Low investor confidence tends to make people clutch their wallets like a dragon guarding its treasure. And guess what? Only 20% of investors are feeling particularly bullish. Meanwhile, the NAAIM Equity Exposure Index is hanging around 60%, which is basically a cryptic “meh” when you’re expecting 80% to get the bull market party started.
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The Fed: The Real Party Pooper
Ah yes, the Federal Reserve. That ever-present entity that loves to make mysterious decisions that shake the market to its core. Peterson is worried that the Fed won’t be as generous with rate cuts as everyone hopes. If the Fed fails to slash rates as expected or continues selling bonds like it’s a yard sale, real yields could rise, leaving Bitcoin and its fellow risk assets crying into their digital pillows.
Sure, Bitcoin’s been resilient this year, but its future hinges on a few big macroeconomic factors—mostly investor sentiment and the all-powerful Fed. If the confidence train keeps rolling downhill or the Fed decides to play hard to get with those rate cuts, Bitcoin might just lose its shine.
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FAQs (Because Who Doesn’t Love a Good FAQ?)
How could Federal Reserve rate cuts affect Bitcoin?
Well, in simple terms, rate cuts make traditional assets like bonds less appealing, which could make Bitcoin look a lot more attractive to investors. Surprise!
How many times will the Fed cut rates in 2025?
The Fed is expected to cut rates at least three times in 2025, making Bitcoin lovers cross their fingers and hope for the best.
What is the Fed rate right now?
As of May 2025, the Federal Reserve’s interest rate is sitting comfortably at 5.00%. Oh, and there’s a lot of “we’ll see” about future cuts.
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2025-05-05 15:12