The U.S. Federal Reserve is under increasing scrutiny as it considers its next steps amid a split in policy opinions, while Bitcoin’s sharp slide into bear territory has fueled ongoing discussions about institutional trust and retail investor wariness. With the Fed’s December meeting drawing near, policymakers remain divided over the possibility of a rate cut, as the cryptocurrency sector contends with historic capital outflows, leveraged trading products, and evolving investor attitudes.
Susan Collins, President of the Federal Reserve Bank of Boston and a significant voice in this year’s policy debates,
indicated there is no "urgent need" to lower rates in December
, stressing that recent rate reductions have already shifted the policy stance toward combating inflation. Her comments highlight the growing disagreements within the Fed,
as more members push back against additional easing, raising doubts
about Chair Jerome Powell’s ability to achieve consensus. Still, recent statements from New York Fed President John Williams and others have altered market sentiment:
the likelihood of a December rate cut has climbed above 70%
, compared to just 40% a week ago.
This change is largely credited by analysts to weakening jobs data
, such as September’s 4.4% unemployment rate—the highest in four years—and fears of a looming “stagflation” scenario.
At the same time, Bitcoin’s value has dropped below $80,000,
resulting in a "death cross" as its 50-day moving average fell under
the 200-day average—a technical pattern often associated with extended bear markets. While some institutional investors,
such as Abu Dhabi’s Mubadala, which has tripled its Bitcoin assets
and El Salvador, which has increased its holdings, remain optimistic, November saw $2.96 billion withdrawn from ETFs. This split highlights a market where major institutions are optimistic about the long-term, even as short-term volatility persists.
Leverage Shares is preparing to launch 3x leveraged Bitcoin and Ethereum ETFs
in Europe to take advantage of the price swings, though critics caution these products carry heightened risks.
The recent crypto downturn has also sparked new developments.
BexBack Crypto Exchange introduced a "Market-Crash Support Package"
that features 100x leverage and onboarding without KYC requirements to help traders manage extreme market moves.
Nonetheless, obstacles remain.
BlackRock’s IBIT has seen $2.1 billion in withdrawals
this month, and Ethereum’s derivatives market is showing reduced interest,
with open interest dropping to $3.57 billion
.
For Bitcoin, experts caution that further losses could occur
if the $80,000 support does not hold, with historical patterns indicating potential declines of 60-70% following death crosses.
Still, institutional optimism provides some balance. Strategy (formerly MicroStrategy) continues to “buy the dip,”
having recently purchased 487 BTC for $49.9 million
and suggesting more acquisitions could follow if prices decrease. CEO Michael Saylor has reaffirmed his belief that
Bitcoin
serves as “productive capital” for the company’s future,
even as concerns linger about convertible debt and liquidity challenges
.
As the Federal Reserve navigates one of its most contentious periods in recent memory and Bitcoin approaches crucial support thresholds, the interaction between macroeconomic instability and the evolving crypto landscape is set to shape 2026.
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