BTC Drops Toward $110K as Powell Strikes Cautious Tone Following Fed Decision

Bitcoin Sinks Below $110K as Powell Dials Back December Rate Cut Expectations

Bitcoin slid sharply late Wednesday after Federal Reserve Chair Jerome Powell delivered unexpectedly hawkish remarks, signaling that another rate cut in December is not guaranteed — a comment that sent tremors through both crypto and equity markets.

“A rate cut in December is far from a foregone conclusion,” Powell said during his post-meeting press conference, challenging investor expectations that the central bank would continue easing into year-end.

The Fed had earlier announced a 25 basis point reduction, bringing the benchmark rate to a range of 3.75%–4.00%, while confirming plans to end quantitative tightening on December 1. Despite the move, Powell’s tone underscored caution amid lingering inflation and slowing job growth.

The statement was enough to reverse early optimism. Bitcoin (BTC) dropped roughly $2,000 within minutes, falling to $109,600, down about 5% over the past 24 hours, and erasing much of its earlier weekly gain. Equities followed suit — the Nasdaq slipped into negative territory, while the 10-year Treasury yield climbed eight basis points to 4.06%. The U.S. dollar index also surged to session highs.

Market expectations for another rate cut in December fell sharply, with CME FedWatch data showing probabilities retreating from 90% to 69%.

There was also division within the Federal Open Market Committee (FOMC). Kansas City Fed President Jeffrey Schmid voted to keep rates steady, while Governor Stephen Miran favored a deeper 50 basis point cut.

Powell acknowledged that labor market conditions are softening but reiterated that inflation “remains somewhat elevated.” His comments reinforced a cautious stance amid a government shutdown that has stalled economic data releases, leaving policymakers to navigate with limited visibility.

“The shutdown’s data blackout makes subsequent Fed decisions unpredictable — and markets hate uncertainty,” said Marcin Kazmierczak, co-founder of RedStone. “Expect crypto volatility to persist through year-end.”

Despite the sell-off, some market participants see the correction as an opportunity.

“Bitcoin’s holding the $110,000–$120,000 range,” said Paul Howard, director at Wincent. “Short-term dips like this often become accumulation windows before broader macro improvements lift risk assets.”

With the Fed’s next move now uncertain, traders are bracing for more volatility — and recalibrating expectations for how long Powell’s tightening bias might linger.