Fed Chair Powell’s Critical Warning Sparks Sudden $60,000 Bitcoin Price Crash

The bitcoin price has suddenly crashed back toward $60,000 per bitcoin after one billionaire bitcoin buyer revealed they’ve flipped on bitcoin. The bitcoin price has struggled over the last month, dropping almost 15%, as fears of a “true correction” swirl.

Federal Reserve Chair Jerome Powell

“The level of debt we have is completely sustainable but the path we are on is unsustainable,” Powell said during the European Central Bank’s Portugal conference, adding the Biden administration was taking excessive risks by “running a very large deficit at a time when we are at full employment” and said “you can’t run these levels in good economic times for very long.”

“Getting the balance on monetary policy right during this critical period, that’s really what I think about in the wee hours,” Powell said in response to a question about his top worries.

The spiraling $34 trillion U.S. debt pile

In May, Treasury secretary Janet Yellen issued a serious warning over the spiraling $34 trillion U.S. debt pile that some think could help propel the bitcoin price to $1 million over the next 18 months.

Bitcoin, crypto and stock market traders have been closely watching the Fed for signs it will begin cutting interest rates in recent months, with analysts forced to dial back expectations of around seven cuts in 2024 to just one or two.

The Federal Reserve left interest rates unchanged and signaled it would make just one cut in 2024

Last month, the Federal Reserve left interest rates unchanged and signaled it would make just one cut in 2024, with more to come in 2025. The Fed has come under pressure to cut interest rates after hiking them at a record-setting clip in the aftermath of huge Covid-era stimulus spending and money printing that sent inflation spiraling out of control.

Eyes are now turning to Wednesday’s release of the Fed’s June meeting minutes and Friday’s jobs report which could “cement” expectations of a September interest rate cut if it shows hiring has slowed.

Friday’s jobs report could cement expectations of a September interest rate cut

“A softer-than-expected jobs report on Friday, were it to come to pass, would likely further cement the case for said cut, to which markets assign a roughly 70% chance—perhaps, a touch underdone,” Michael Brown, senior research strategist at Pepperstone, told MarketWatch.