Bitcoin Nosedives Below $96,000 Amid Federal Reserve Uncertainty

Bitcoin's price fell below $96,000 on November 14, 2025, marking its lowest point since May. The cryptocurrency reached an intraday low of $94,208, reflecting a decline of over 23% from its early October peak of approximately $126,173. This downturn is largely attributed to diminishing expectations of a December interest rate cut by the U.S. Federal Reserve, prompting investors to retreat from riskier assets.

The broader cryptocurrency market mirrored Bitcoin's decline. Ethereum (ETH) dropped to an intraday low of $3,076.42, down from its September peak of $4,625. Other major cryptocurrencies, including Solana (SOL) and Dogecoin (DOGE), also experienced significant losses. The overall cryptocurrency market capitalization has contracted from $4.28 trillion to $3.27 trillion within a month.

Investor sentiment has been further influenced by substantial outflows from U.S. Bitcoin spot ETFs. On November 13, these funds saw withdrawals totaling $278 million, followed by a record $866 million on November 14. This trend underscores a growing risk-off attitude among investors amid macroeconomic uncertainties.

The Federal Reserve's monetary policy plays a pivotal role in shaping market expectations. A Reuters poll conducted in November 2025 revealed that 80% of economists anticipate a 25-basis-point rate cut in December, which would lower the federal funds rate to a target range of 3.50%-3.75%. However, Federal Reserve Chair Jerome Powell has signaled that a December rate cut is not guaranteed, particularly amidst missing data caused by a prolonged government shutdown. Federal Reserve Governor Stephen Miran stated, "I expect us to cut in December unless there's some sort of surprise." He emphasized that while a rate cut is expected, it is not guaranteed and could change if surprises in economic conditions arise.

Market indicators reflect this uncertainty. As of November 5, 2025, the CME FedWatch Tool indicated a 63.8% probability of a 25-basis-point rate cut at the December 10 Federal Open Market Committee (FOMC) meeting, a decline from earlier expectations that were consistently above 70%. Analysts suggest that the Federal Reserve aims to balance controlling inflation with preventing a sharper economic slowdown.

The recent downturn in cryptocurrency prices highlights the inherent volatility of digital assets and their sensitivity to macroeconomic factors. The substantial outflows from Bitcoin ETFs suggest that investors are re-evaluating their exposure to cryptocurrencies in light of changing economic conditions and monetary policy expectations.

As the Federal Reserve's monetary policy continues to evolve, the cryptocurrency market remains highly responsive to macroeconomic signals. Investors should stay informed about policy developments and be prepared for potential volatility in digital asset valuations.