Bitcoin News Today: Bitcoin Slides Past $90,000 as Fed Cautiousness Dampens Rally Hopes

Bitcoin prices dropped below $90,000 on Thursday, reacting to the U.S. Federal Reserve's decision to cut interest rates amid a divided policy outlook. The 25-basis-point reduction brought the benchmark rate to 3.50%-3.75%, but mixed messaging from Fed officials dampened market optimism. Investors appeared to price in the cut well in advance, leaving limited room for a meaningful rally in risk assets like crypto according to data.

The Fed's updated projections showed only one rate cut expected in 2026, far below the expectations of many market participants. This cautious approach, coupled with internal dissent from officials, created uncertainty around the path of monetary policy. A 9–3 split among policymakers, with two voting against any cut and one calling for a larger 50-basis-point move, underscored the division.

Bitcoin's slide also coincided with broader market jitters, including a disappointing earnings report from Oracle, which raised concerns about the profitability of artificial intelligence investments. The firm's revenue and profit forecasts missed expectations, signaling that heavy AI outlays may not translate into immediate gains. This weighed on risk appetite and shifted investor focus toward fundamentals over speculative bets.

Why the Standoff Happened

The Fed's decision reflected a careful balancing act between inflation control and labor market dynamics. Chair Jerome Powell emphasized that policy was "not on a preset course" and that the central bank remained "data-dependent." Despite the rate cut, the Fed's updated "dot plot" showed little consensus for more than one rate cut in 2026, signaling a slower easing trajectory than markets had anticipated.

This divergence between the Fed's forward guidance and market expectations has led to volatility. Some analysts noted that the Fed's hawkish tone surprised markets, causing a price reversal in Bitcoin and keeping risk appetites in check. With only one projected rate cut for 2026, the message was clear: monetary easing would be limited.

How Markets Reacted

The broader cryptocurrency market followed Bitcoin's lead, with most altcoins falling more sharply than the leading digital asset. Ethereum dropped 3.7% to $3,203.92, while XRP fell nearly 4% to $2.01. Cardano plunged over 7%, and other tokens like Dogecoin and $TRUMP also experienced significant declines according to reports.

On-chain data from platforms like CryptoQuant suggested that selling pressure was beginning to ease. Exchange deposits declined as large players reduced transfers to exchanges, a sign that panic selling may be abating. However, short-term holders continued to offload Bitcoin at a negative profit margin, indicating lingering pessimism according to analysis.

What Analysts Are Watching

Analysts highlighted a growing gap between Bitcoin's fundamentals and its price movements. Timot Lamarre of Unchained noted that while adoption is increasing, the price has not risen as expected. This divergence raises questions about whether institutional buying is enough to offset retail selling and ETF outflows.

Meanwhile, Standard Chartered revised its year-end Bitcoin price target to $100,000 from $200,000, citing a slowdown in corporate treasury buying. Bernstein analysts, however, remain optimistic, forecasting a prolonged bull cycle driven by steady institutional demand and minimal ETF outflows. They raised their 2026 target to $150,000 and expect a peak near $200,000 by 2027.

JPMorgan, too, holds a bullish outlook, projecting a gold-linked, volatility-adjusted target of $170,000 within six to twelve months. However, the firm emphasized the need to factor in market fluctuations and mining costs according to analysis.

Risks to the Outlook

The Fed's rate-cutting path remains uncertain, with six officials now expecting no cuts in 2026. This hawkish bias is raising the bar for future meetings and could prolong the current environment of elevated interest rates. For cryptocurrencies, this means continued headwinds for risk assets but also the potential for a more stable, predictable market.

Political developments also weigh on the outlook. U.S. President Donald Trump is weighing a replacement for Fed Chair Jerome Powell, with Kevin Hassett, a former Coinbase adviser, emerging as a frontrunner. Hassett is seen as an industry-friendly choice, and his potential appointment could shift market sentiment toward a more dovish stance.

For now, Bitcoin faces key support levels at $87,200 and $84,000. Resistance remains at $94,000 and beyond. Traders are closely watching whether the market can regain momentum or if further corrections are on the horizon.