Bitcoin briefly dipped to lows at the $60,804 mark in a session of volatile trade on Wednesday before rebounding.
At the time of writing, Bitcoin had bounced back to trade just over $64,139, up around 2.31% from 24 hours prior. Earlier on Wednesday, Bitcoin hit an intraday high of $64,403.
Despite its recent price drop, Bitcoin has maintained an impressive performance, boasting a 124% surge yearly. Last week, the world's leading cryptocurrency reached a record high of nearly $73,800.
After days of falls, Bitcoin sank to a near-two-week low as demand for U.S. exchange-traded funds dried up. Since their inception on Jan. 11, the goods have generated a net inflow of $11.7 billion, with the largest outflow being on Tuesday.
Bitcoin's decline also comes amid uncertainty over whether above-target inflation will prompt Fed policymakers to reduce rate-cut estimates at their meeting on Wednesday, implying a less favorable outlook for speculators.
Big Fed policy decision day arrives
Investors await today's Fed policy decision, especially because no rate change is predicted at the 2:00 p.m. announcement. Fed Chair Jerome Powell is also unlikely to indicate that rate cuts are forthcoming when he holds a press conference following the decision.
Today's meeting is about the Fed's next steps, as it begins detailed discussions about lowering its balance sheet, often known as quantitative tightening. The funding market indicates that the Fed still has time to decide exactly how and when to do this.
The consensus among economists is be that the Fed will continue on its current path (three cuts, the first in June), although this is not a foregone conclusion. At least in terms of inflation, 2024 has been characterized by higher-than-expected readings.
Bitcoin has always reacted to key Fed decisions, but whether this will have an impact on prices this time is unclear.