US monetary tightening slows Bitcoin’s progress

Bitcoin is not weakening because of its own limitations, but because the global economic climate is reshuffling the risk cards. Between contradictory signals from the United States and monetary changes in Japan, investors are reconsidering their priorities. In fact, the flagship crypto, which has driven the markets in recent months, is declining in portfolios. This shift says nothing about its intrinsic solidity, but everything about the ambient nervousness in the face of a monetary policy which remains, for the moment, unpredictable.

The shadow of the Fed: disappointed expectations

For several weeks, bitcoin has failed to regain the ascendancy, unable to sustainably cross the $92,000 mark. This inertia is largely explained by the decline in expectations of monetary easing from the American Federal Reserve.

According to the CME FedWatch Tool, the probability of a rate cut at the January 2026 FOMC fell to 22%, down from 24% the previous week. Despite clear signals in favor of a change in monetary tone, traders remain increasingly uncertain about the Fed's ability to bring rates below 3.5% by 2026.

This uncertainty is reinforced by a tense political and administrative context. Indeed, 43 days of government shutdown prevented the publication of crucial economic statistics, further obscuring the short-term outlook.

Added to this is a series of technical and behavioral elements which are slowing down the progress of bitcoin. Among the key factors identifiedwe note:

• The continued reduction of the Fed's balance sheet in 2025, which limits the liquidity available in the markets and negatively affects speculative assets like bitcoin;

• A clear revival of appetite for US Treasury bonds, whose 10-year yield remains stable at 4.15%, indicating an investor preference for safe havens;

• A growing decoupling between bitcoin and the equity markets, notably the S&P 500, which remains less than 1.5% from its historic highs, where bitcoin stagnates at 30% below its October peak;

• The dominance of gold as a hedging asset, despite the decentralized nature of bitcoin.

These combined elements reflect a shift in the market towards a defensive posture. Bitcoin, long seen as a performance relay in an inflationary environment, today seems relegated behind more traditional assets, in a context of a marked return to risk aversion.

A global economy in decline

Beyond American monetary dynamics, it is a series of global macroeconomic signals, often perceived as secondary, which seems to gradually erode confidence in bitcoin as a short-term investment asset.

In the United States, consumption, the central pillar of the economy, is showing signs of weakness. Iconic companies like Target and Macy's have revised their outlook for the fourth quarter downward, warning of the impact of inflation on their margins.

Also, Nike announced a drop in quarterly sales on December 18, precipitating a 10% drop in its stock. These data confirm a slowdown in household spending, a historically unfavorable environment for assets considered speculative. A decline in consumer spending traditionally creates bearish sentiment for risky assets.

Moreover, the nervousness is not limited to American borders. Japan, the world's third largest economy, announced a contraction in its GDP of 2.3% at an annualized rate in the third quarter. This disappointing performance comes despite interest rates remaining negative for more than a decade and a currency depreciation policy supposed to stimulate activity.

The Japanese bond market is also sending an alarm signal: 10-year yields have crossed 2% for the first time since 1999. This tension on Japanese debt increases the risk of global contagion on the financial markets, already under pressure. In this context, the decreasing correlation of bitcoin with traditional markets, often perceived as an asset, becomes a weakness. It means that bitcoin no longer necessarily benefits from the dynamics of other assets, while remaining exposed to the same risk aversion.

The price of bitcoin remains trapped in a climate of uncertainty where each macroeconomic signal redraws the contours of the market. Without a clear catalyst, crypto is struggling to regain its momentum, oscillating according to rate expectations and institutional flows. Caution is required as long as the overall monetary course remains unclear.