Bitcoin News Today: Perfect Storm of Geopolitics and Fed Moves Could Shrink Bitcoin by 70%

Bitcoin Price Prediction: Trader Warns of Potential 70% Loss Amid Geopolitical and Monetary Shifts

The cryptocurrency market is bracing for potential volatility as a prominent trader warns that Bitcoin (BTC) could lose up to 70% of its value in the coming months. This dire forecast comes amid shifting geopolitical dynamics and evolving monetary policy, with U.S.-China trade developments and Federal Reserve decisions playing pivotal roles in shaping market sentiment, as shown in a Yahoo Finance video.

President Donald Trump's recent meeting with Chinese leader Xi Jinping in South Korea underscored the fragility of global trade relations. Trump announced a reduction in U.S. tariffs on Chinese goods from 57% to 47%, a move he described as resolving "rare earths" trade disputes, according to the Yahoo video. The announcement initially triggered a mixed reaction in the crypto market. Bitcoin briefly dipped to $108,000 following the meeting, extending a decline from $113,000 to $110,000 sparked by Federal Reserve Chair Jerome Powell's downplaying of a December rate cut, as reported in a Yahoo Finance article. However, the asset rebounded to around $111,300, as The Block reported, after Trump reiterated his optimism about a near-term trade deal. Analysts, however, caution that the absence of official confirmation from Beijing and lingering uncertainties over inflation and Fed policy could reignite volatility, the same The Block post noted.

The Federal Reserve's recent policy adjustments further complicate the outlook. The central bank cut its benchmark interest rate to 3.75%-4%, signaling a shift toward easier financial conditions after two years of tightening. Simultaneously, the Fed announced the end of quantitative tightening by December 1, a move that could inject liquidity into markets and bolster risk assets, as covered in the Yahoo Finance article. These measures align with Bitcoin's traditional role as a beneficiary of accommodative monetary environments, as lower real yields and reduced cash-heavy positioning often drive demand for non-yielding assets. Yet, the market remains cautious, with analysts noting that the Fed's dovish stance could unravel if inflation surprises spark renewed hawkishness, a point also raised in the The Block report.

Compounding these factors is the uncertainty surrounding the U.S.-China trade deal. While Trump emphasized progress, analysts like Derek Lim of Caladan highlight that China has not publicly confirmed the terms, leaving room for geopolitical tensions to resurface, as discussed in the The Block coverage. A breakdown in negotiations could trigger a dollar rally and a sell-off in risk assets, including Bitcoin. Conversely, a durable trade agreement could reinforce the "soft landing" narrative, potentially pushing Bitcoin above $115,000, the Yahoo Finance article suggested.

Beyond macroeconomic factors, technological developments are reshaping Bitcoin's ecosystem. Projects like Bitcoin Hyper, a Layer-2 solution built on the Solana Virtual Machine and anchored to Bitcoin, aim to enhance scalability and transaction efficiency, according to a Bitcoinist article. By enabling micropayments, retail transactions, and DeFi applications, such innovations could expand Bitcoin's utility beyond its role as a store of value. While these advancements may bolster long-term adoption, they remain speculative in the short term and unlikely to counteract immediate market pressures.

The trader's 70% loss warning reflects a bearish view rooted in the interplay of geopolitical fragility, macroeconomic uncertainty, and regulatory shifts. With the Fed's policy trajectory and U.S.-China relations as key swing factors, the coming months will test Bitcoin's resilience. For now, the market remains in a tug-of-war between optimism over liquidity and skepticism over the sustainability of the current environment, as the The Block coverage observed.