Bitcoin News Today: Bitcoin's Death Cross and Fed's Rate Dilemma Fuel Stagflation Debates

The U.S. Federal Reserve faces mounting pressure as it weighs its next moves in a divided policy environment, while Bitcoin's volatile descent into a bear market has intensified debates over institutional confidence and retail caution. With the Fed's December meeting approaching, officials remain split on whether to cut rates, while crypto markets grapple with record outflows, leveraged products, and shifting investor sentiment.

Federal Reserve Bank of Boston President Susan Collins, a key policymaker this year, signaled no "strong need" for a December rate cut, emphasizing that recent reductions have already tilted policy toward inflation control. Her remarks reflect broader internal dissent within the Fed, where rising opposition to further easing suggests Chair Jerome Powell may struggle to secure broad consensus. However, recent comments from New York Fed President John Williams and others have shifted market expectations: the probability of a December rate cut now exceeds 70%, up from near 40% a week earlier. Analysts attribute this shift to deteriorating labor market data, including a 4.4% unemployment rate in September-the highest in four years-and concerns over a potential "stagflationary" scenario.

Meanwhile, Bitcoin's price has plummeted below $80,000, triggering a "death cross" as its 50-day moving average dipped below the 200-day line-a technical signal historically tied to prolonged bear markets. Institutional inflows, including Abu Dhabi's Mubadala tripling its Bitcoin holdings and El Salvador boosting its reserves, contrast with $2.96 billion in ETF outflows in November. This divergence underscores a fragmented market, where major players remain bullish on long-term prospects despite short-term turbulence. Leverage Shares' upcoming 3x Bitcoin and Ethereum ETFs in Europe aim to capitalize on volatility, though critics warn of amplified risks.

The crypto selloff has also spurred innovation. BexBack Crypto Exchange launched a "Market-Crash Support Package" offering 100x leverage and no-KYC onboarding to help traders navigate extreme swings. Similarly, Bitcoin Munari, a new project, began a Solana-based presale at $0.10 per token, leveraging the network's infrastructure before migrating to a standalone Layer-1 chain in 2027.

Yet challenges persist. BlackRock's IBIT alone recorded $2.1 billion in redemptions this month, while Ethereum's derivatives market shows waning appetite, with open interest falling to $3.57 billion. For Bitcoin, analysts warn of further declines if the $80,000 support level fails, with historical precedents suggesting drops of 60-70% after death crosses.

Institutional confidence, however, remains a counterweight. Strategy (formerly MicroStrategy) continues its "buy-the-dip" strategy, recently acquiring 487 BTC for $49.9 million and hinting at more purchases as prices fall. CEO Michael Saylor has reiterated that Bitcoin is "productive capital" for the company's long-term growth, despite concerns over convertible debt and liquidity risks.

As the Fed navigates its most contentious policy environment in years and Bitcoin tests critical support levels, the interplay between macroeconomic uncertainty and crypto's structural shifts will likely define 2026.

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