Bitcoin News Today: Investors Braced for Powell's Verdict as Bitcoin Tumbles Below $114K

Bitcoin has experienced a sharp decline, dropping below $114,000 on August 19, 2025, amid growing investor caution ahead of Federal Reserve Chair Jerome Powell’s highly anticipated speech at the Jackson Hole Economic Symposium. The price retreated to around $113,000 after reaching an intraday high of $117,300 earlier in the week. This move follows a broader market correction, with the total crypto market capitalization dropping below $3.88 trillion, marking its lowest level in over two weeks [3].

The sell-off was exacerbated by uncertainty surrounding the timing of a potential September interest rate cut by the Fed. Earlier in the week, the U.S. and the European Union had reached a deal to reduce Trump-era tariffs on EU goods from 30% to 15%, but this news failed to provide much-needed support to crypto markets. The price action suggests that the market had already priced in the trade agreement, and the lack of a clear macroeconomic catalyst left investors exposed to profit-taking and liquidity outflows [5].

One key factor contributing to the price decline is the diminishing likelihood of a 25 basis point rate cut in September. At one point, markets had priced in a near 100% probability of a cut, but this has now dropped to 71% according to market data. Analysts attribute this shift to the recent inflation report, which showed core prices rising by 3.1%, raising concerns that the Fed may be reluctant to ease monetary policy as quickly as previously expected [1].

Bitcoin ETFs, which had been seen as a bullish indicator for the market, have also contributed to the downward pressure. These funds have seen four consecutive days of net outflows, with nearly $1 billion in redemptions recorded. BlackRock, one of the largest ETF issuers, was reported to have sold $111 million worth of BTC following significant outflows from its fund [5].

Despite the recent weakness, some analysts remain optimistic about Bitcoin’s long-term trajectory. Michael van de Poppe, founder of MN Capital, suggested that the recent price sweep below $112,000 had created favorable entry points for investors. He noted that the "uptrend is back" and that the market is showing resilience. Bitwise’s André Dragosch also suggested that regulatory developments, such as the potential inclusion of crypto in 401(k) retirement plans, could push Bitcoin to $200,000 by the end of the year [1].

However, the broader market sentiment has turned more cautious in recent days. The crypto fear and greed index has dropped from 68 to 56, signaling a shift toward fear territory. Ethereum and other major altcoins have also been hit hard, with XRP, Chainlink, and Toncoin all declining by 4%-6% in a single day. This broad-based weakness highlights the deep integration of crypto with macroeconomic sentiment and liquidity flows [3].

Looking ahead, the outcome of Powell’s speech on August 23 will be a key event for the market. Analysts are closely watching for any signals on the Fed’s policy direction. A dovish stance would likely provide a boost to risk assets like Bitcoin, while a more hawkish tone could prolong the current consolidation phase. In the meantime, traders are holding off on new positions, waiting for greater clarity on both monetary policy and broader macroeconomic conditions [1].

Source:

[1] Crypto Is Braced For A Fed Price Bombshell As 'Spiral Of ... (https://www.forbes.com/sites/digital-assets/2025/08/22/serious-spiral-of-doom-strategy-warning-fuels-sudden-bitcoin-price-crash-fears/)

[2] Bitcoin Price Falls — And As Usual, Nobody Knows Why (https://bitcoinmagazine.com/markets/bitcoin-price-falls-nobody-knows-why)

[3] Bitcoin Drops Below $114K, Ether Loses $4.2K as Jackson ... (https://www.coindesk.com/markets/2025/08/19/bitcoin-drops-below-usd114k-ether-loses-usd4-2k-as-jackson-hole-speech-might-bring-hawkish-surprise)

[4] Bitcoin Price Crash Fears Gather As Crypto Braces For A ... (https://www.forbes.com/sites/digital-assets/2025/08/19/wall-street-issues-serious-66-trillion-crypto-warning-as-price-crash-fears-hit-bitcoin-ethereum-and-xrp/)

[5] Bitcoin Falls Even as U.S., EU Reveal Deal on Trump Tariffs (https://coingape.com/bitcoin-falls-even-as-u-s-eu-reveal-deal-on-trump-tariffs/)