Bitcoin Slips After Winning Streak

Bitcoin slipped on Wednesday after a three-day winning streak and a record high, as profit-taking took place ahead of a Federal Reserve interest rate decision.

Bitcoin fell 2.4% to $103,688.0 by 01:13 ET (06:13 GMT), after breaching the $108,000 level a day earlier.

The largest cryptocurrency reached an all-time high of $108,244 briefly on Tuesday, following incoming President Donald Trump’s suggestion of a Strategic Bitcoin Reserve during a CNBC interview.

Bitcoin Supported by Strategic Reserve Prospects and Whale Trades

Trump has vowed to introduce crypto-friendly regulations if elected, indicated by his nominations for pro-crypto cabinet and regulatory roles. However, analysts doubt the feasibility of a Bitcoin reserve due to the mechanics involved.

Concerns grow over a strategic reserve’s likelihood, given Trump’s strong belief in the dollar's supremacy. Meanwhile, large Bitcoin holders, or whales, are impacting price movements significantly.

Ali Martinez, an on-chain analyst, reported that whales acquired 70,000 bitcoins by Tuesday, indicating demand exceeds supply, fueling Bitcoin's ongoing price surge. Only 900 bitcoins can be mined every 48 hours, raising concerns about an impending supply crunch if demand remains high.

Crypto Prices Today: Altcoins Drop Ahead of Fed Rate Decision

Other cryptocurrencies mirrored Bitcoin’s trend as traders were cautious with the Federal Reserve meeting in progress. Investors took profits on altcoins, which had seen strong gains in recent sessions.

World no.2 crypto Ether dipped 4.7% to $3,839.41, while world no.3 crypto XRP edged down 0.3% to $2.51. Solana dropped slightly, and Polygon fell 6.3%, while Cardano rose over 2%. Among meme tokens, Dogecoin lost 0.8%.

The Fed is anticipated to cut interest rates by 25 basis points on Wednesday. However, market focus is on the central bank’s long-term outlook on rates amid persistent inflation and a robust economy, potentially suggesting a slower pace of rate cuts in 2025, which could challenge cryptocurrency prices.