Bitcoin (BTC) Price: Drops Below $90,000 After Fed Rate Cut and Oracle AI Concerns

TLDR

• Bitcoin fell below $90,000 on Thursday after Oracle’s weak outlook raised concerns about AI profitability
• The Federal Reserve cut rates by 25 basis points on Wednesday but signaled caution about future cuts
• Bitcoin spiked to $94,400 after Powell’s comments on labor market weakness before retreating to $92,000
• Standard Chartered lowered its 2025 Bitcoin price forecast from $200,000 to $100,000
• The Fed will purchase $40 billion in Treasury securities over the next month to ease financial conditions

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Bitcoin fell below $90,000 on Thursday as concerns about artificial intelligence profitability weighed on technology stocks. The decline came after U.S. cloud firm Oracle missed profit and revenue forecasts.

Bitcoin (BTC) Price

Bitcoin was down 2.5% at $90,056.24. Ether dropped 4.3% to $3,196.62. The losses erased two days of gains and extended weakness that started Wednesday after the Federal Reserve’s interest rate decision.

The Federal Reserve cut its fed funds rate by 25 basis points on Wednesday. The central bank signaled it would take a cautious approach to future rate cuts.

Bitcoin experienced wild swings during Fed Chair Jerome Powell’s press conference. The cryptocurrency spiked above $94,000 when Powell discussed potential labor market weakness. It then retreated to $92,000 after he said inflation remains a concern.

Bitcoin was trading around $92,000 for most of Wednesday. The price jumped to $94,400 during Powell’s comments about labor market risks. The gains disappeared after Powell warned that the fight against high inflation continues.

Recently, Bitcoin fell to $92,000, down 0.8% over 24 hours. Ether showed relative strength, wobbling above $3,300 and rising 1.1% during the same period.

Market Reaction

U.S. stocks posted gains before the close of trading. The Nasdaq rose 0.5% and the S&P 500 gained 0.7%. The dollar fell 0.6% against the yen, euro, and pound.

E-Mini S&P 500 Dec 25 (ES=F)

Powell said Fed policy is now within a range of plausible estimates of neutral. He stated the central bank is well positioned to determine the timing of additional adjustments.

Powell acknowledged a great deal of data will arrive before the Fed’s January meeting. This information will influence how the central bank moves forward.

Two FOMC members voted against the rate cut. This showed the decision was a close call complicated by incomplete data.

The New York Fed announced it will purchase short-term Treasury bills starting Friday. The purchases will target around $40 billion over the next month. This step aims to ease financial conditions without starting full quantitative easing.

Outlook Changes

Standard Chartered lowered its Bitcoin price forecast on Tuesday. The bank now expects Bitcoin to reach $100,000 by the end of 2025 instead of $200,000.

Geoff Kendrick from Standard Chartered said buying by Bitcoin digital asset treasury companies is likely over. He stated future Bitcoin price increases will be driven mainly by ETF buying.

Tony Sycamore from IG said the crypto space needs more convincing evidence that the October 10 selloff is complete. He said at this point it doesn’t look like that evidence exists.

Brian Coulton from Fitch Ratings said the relatively mild pickup in core inflation probably swayed the committee to cut rates. He expects just two more cuts by June 2026, taking the fed funds rate to 3.25%.

David Hernandez from 21Shares said Bitcoin needs fresh momentum to overpower concentrated short pressure at the $94,500 resistance zone. He noted this is where Wednesday’s burst higher hit a ceiling.

Oracle’s weak outlook raised fresh concerns about AI infrastructure spending. The company’s executives flagged higher spending as a sign AI outlays are not turning profits as quickly as hoped.

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