Bitcoin’s price moved around a lot more this week, dropping below $113,000 as crypto traders and investors got ready for U.S. Federal Reserve Chair Jerome Powell’s highly anticipated speech at the annual Jackson Hole symposium. The Federal Reserve’s stance on future interest rate cuts hangs in the balance, with Powell’s remarks expected to help set the direction for U.S. monetary policy and Bitcoin’s price trajectory for the rest of 2025.
Speculation about interest rates moves the Bitcoin markets.
On Wednesday, the price of Bitcoin dropped to a two-week low of $112,565. This was because traders were worried about the economy, and there were “fear spikes” in digital asset trading. Ryan Lee, the chief analyst at the Bitget exchange, said that the tension surrounding Powell’s speech has caused investors to “let the narratives settle and let liquidity return.” This could mean that the strong $112,000 support level could be the start of the next bullish phase.
Recent data from the U.S. Consumer Price Index (CPI) showed that inflation was running at 2.7% year-over-year, which is higher than the Fed’s 2% goal and makes it less likely that the market will cut rates right away. The CME Group’s FedWatch tool shows that the chances of a rate cut in September went from 94% early last week to only 82% after the CPI report came out. Market experts, like André Dragosch from Bitwise, think that more rate cuts could lead to a big increase in the U.S. money supply and a steeper yield curve, which would cause more Bitcoin rallies in 2025.
Trends in Corporate Accumulation and Demand
Even though retail traders have mixed feelings about it, institutional and corporate buyers keep buying Bitcoin and Ether. BitcoinTreasuries.NET says that 297 public entities, such as companies, investment funds, and governments, now own 3.67 million BTC, which is more than 17% of the total Bitcoin supply. This is a big increase from 124 entities at the beginning of June.
As investors wait for Federal Reserve Chair Jerome Powell to give them a sign, Bitcoin’s short-term direction depends on interest rate policy and the overall economy. The cryptocurrency’s fundamentals are still strong, even though short-term price changes show that the world is uncertain. This is because both individuals and institutions are buying more of it.
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