End of 'Dovish Powell' Effect? ... Possibility of Bitcoin Falling Below $110,000

Only a Day After the 'Jackson Hole Speech'

Bitcoin Turns to a Downtrend

"Market Uncertainty Overwhelms"

May Fall Below $110,000 This Month

Despite dovish (preference for monetary easing) remarks by Jerome Powell, Chair of the Fed, Bitcoin (BTC) prices are deepening their downward trend. There are even observations that the $110,000 level may collapse within this month.

According to CoinMarketCap, a digital asset market tracking site, Bitcoin is trading in the $111,000 range as of today, down about 2.5% from the previous day. Compared to a week ago, it has dropped about 3%.

Initially, the price of Bitcoin surged from the $111,000 range to the $117,000 range on the 22nd. This was influenced by Chair Powell's Jackson Hole speech in Wyoming, USA, on the same day, where he hinted at a potential shift toward a rate cut stance. Immediately following Powell's dovish remarks, the probability of a 0.25% rate cut by the Fed in September, as reported by CME FedWatch, soared from the 70% range to the 90% range.

Powell's 'Subtly Dovish' Remark

However, the upward momentum did not last long. Bitcoin prices reversed to a downtrend just a day after Powell’s Jackson Hole speech on the 23rd. Following that, the price continued to perform poorly over the weekend, dropping back to the $111,000 range. In just three days, prices had returned to levels seen just before Powell's Jackson Hole address.

Powell's 'subtle remarks' are a major factor behind the Bitcoin decline. While Powell kept the possibility of rate cuts open during his Jackson Hole speech on the 22nd, he did not offer a clear signal. This stands in contrast to last year's Jackson Hole event, where he outright asserted the need for a rate cut, stating that "it is time to adjust monetary policy." Andrew Grantham, Chief Economist at CIBC, said, "Depending on the August jobs report, the Fed may cut rates in September or October."

Uncertainty increased because, even if a cut happens next month, the chances of it leading to a consecutive rate-cut cycle remain slim. Stephen Stanley, Chief U.S. Economist at Santander Capital Markets, analyzed, "September’s (Fed) message is likely to be 'cut once and see how it goes.'" Nick Ruck, Director at LVRG Research, explained, "The sharp drop in Bitcoin reflects the 'market recalibration,'" and added, "Lingering market uncertainty has overwhelmed Powell’s dovish speech."

Bitcoin Whales Engage in 'Massive Selling'

Movements by whales (large investors) are cited as another factor driving Bitcoin prices lower. Jacob King, CEO of WhaleWire, posted on X, "Today’s Bitcoin plunge is believed to have resulted from a major whale selling off large amounts of Bitcoin and buying Ethereum (ETH)." He stated, "This whale has sold $2 billion (about ₩2.8 trillion) worth of Bitcoin so far," adding, "An additional $670 million (about ₩900 billion) worth of Bitcoin is being sold," and noted, "Most of the (sale) funds are shifting to Ethereum."

The market increasingly sees a high likelihood that Bitcoin will soon fall below $110,000. On Polymarket, the world’s largest betting site, the probability that Bitcoin will drop below $110,000 this month soared by 47 percentage points from 20% the previous day to 67%. The last time Bitcoin fell below $110,000 was early last month.

Given these conditions, Bitcoin dominance (market share) is also declining. According to CoinMarketCap, Bitcoin dominance stands at 57.5%—down 3.1 percentage points from 60.6% a month ago. Over the same period, Ethereum’s dominance rose from 11.6% to 14.3%, up 2.7 percentage points. The Block reported, "The decline in (Bitcoin dominance) suggests investors are shifting their attention to altcoins."

It is also suggested that funds leaving Bitcoin could flow into Ethereum. In fact, as of the 22nd, U.S. spot Bitcoin ETFs saw six consecutive sessions of net outflows, whereas spot Ethereum ETFs recorded two consecutive sessions of net inflows. DarkPost, a contributor at CryptoQuant, noted, "Since last month, Binance whales have significantly increased Ethereum spot and futures buying activity" and added, "Such accumulation could likely push the price of Ethereum to $5,000."