Bitcoin just dropped to around $90,000, marking its lowest level since late March and early April when it traded for around $80,000. According to Financial Times, this has wiped out $1.2 trillion in value from the crypto since it peaked at over $125,000 in October 5. Although BTC slowly dropped in value after it hit its record high, the biggest drop happened on October 10 after U.S. President Donald Trump threatened to massively increase tariffs on Chinese goods in retaliation for Beijing’s rare earth export controls. The cryptocurrency’s value went downhill after that, with Bitcoin now suffering an almost 30% loss in value from the first week of October.
Despite the current administration’s pro-crypto stance, higher interest rates from the Federal Reserve make cryptocurrency a less lucrative asset for investors. After all, a higher interest rate would offer greater returns on bonds and savings accounts, which are a lot safer than volatile tokens. And with experts now unsure if the Federal Reserve will reduce interest rates in December, there’s more incentive for BTC holders to liquidate their positions.
