Bitcoin Extends Losses as Profit-Taking, U.S. Policy Uncertainty Weigh on Sentiment

Bitcoin declined for a third consecutive session on Wednesday, as profit-taking from recent record highs continued. Concerns over U.S. trade and monetary policy added to the cautious market mood, pushing the cryptocurrency further away from the coveted $100,000 milestone.

The world’s largest cryptocurrency fell 1.6% to $93,131.5 by 01:16 ET (06:16 GMT), continuing its retreat after peaking near $99,000 last week.

Profit-Taking Amid Policy Uncertainty

Bitcoin’s pullback was driven by traders locking in gains from a robust November rally that propelled it to record highs. Disappointment over the failure to breach the psychologically significant $100,000 mark also dampened sentiment.

Adding to the bearish pressure, U.S. President-elect Donald Trump reignited fears of a global trade war by threatening tariffs on multiple trading partners. These developments weighed on broader market risk appetite, spilling over into crypto markets.

U.S. Economic Data and Fed Policy in Focus

Investors are closely monitoring U.S. economic data, including the Personal Consumption Expenditures (PCE) price index—the Federal Reserve’s preferred inflation gauge—due later on Wednesday. The reading is expected to influence the central bank’s trajectory on interest rate cuts.

The minutes from the Fed’s November meeting, released earlier this week, revealed a split among policymakers over the pace of rate easing. While some members advocate for gradual cuts, others call for more cautious adjustments.

The release of revised third-quarter GDP data later today will also provide insights into the U.S. economy’s resilience, which could impact the Federal Reserve’s decisions.

Crypto Market Awaits Trump’s Policy Details

Trump’s crypto policy remains a focal point for traders. His campaign promises, including establishing the U.S. as the “crypto capital” of the world and the idea of a national Bitcoin reserve, have generated optimism in the sector.

Additionally, Trump’s cabinet picks—Scott Bessent for Treasury Secretary and Howard Lutnick for Commerce Secretary—are viewed as crypto-friendly, offering some reassurance to market participants. However, tangible policy direction is expected only after Trump takes office on January 20.

Altcoins Mirror Bitcoin’s Weakness

The decline in Bitcoin triggered a broader retreat in the crypto market, with major altcoins tracking its weakness. Ethereum, the second-largest cryptocurrency, fell 0.4% to $3,419.99.

XRP, Solana, Cardano, and Polygon saw losses ranging from 0.9% to 5%, with XRP leading the decline. Meme coin Dogecoin also dropped 3%.

Bitcoin remains under pressure from profit-taking and uncertainty surrounding U.S. policies. While the promise of crypto-friendly measures under Trump offers long-term optimism, short-term sentiment will likely hinge on economic data and Federal Reserve signals.

Market participants are also awaiting stronger catalysts to reignite bullish momentum in Bitcoin, potentially reclaiming its upward trajectory. Until then, further downside corrections may persist as traders seek clarity on macroeconomic and crypto-specific developments.