Bitcoin’s (CRYPTO: BTC) dip from its all-time high of $108,135 on Dec. 17 to its current price around $93,100 has prompted questions about the market’s direction, the impact of government actions and what the future holds under the incoming Trump administration.

Benzinga spoke to several industry experts to take the temperature on Bitcoin’s near-term future,

Market Reversal: Temporary Dip Or A Vibe Shift?

The recent downturn has investors wondering if this is a minor correction or a sign of a more significant market shift.

Patrick Liou, Principal of Institutional Sales at crypto exchange Gemini, points to stronger than expected U.S. economic data, especially in the labor market, which triggered a broad sell-off in risk assets, including Bitcoin.

Bradley Howell, Head of Linear Trading at Keyrock, agrees that the Federal Reserve’s Dec. 18 dot plot, indicating an expectation of only 50 basis points in rate cuts for 2025, impacted all markets.

Howell also noted that slower year-end markets and market participants taking time away from their screens contributed to the downturn, but suggested that the market should have fully priced this in by now.

Julian Beltran, CTO and co-founder of Stabolut, offers a more technical perspective, suggesting that the recent drop represents “natural profit-taking” after a period of consolidation near the $100,000 mark.

Beltran emphasizes that “key metrics remain bullish: ETF inflows continue steadily, institutional adoption is growing and market infrastructure is stronger than in previous cycles.”

Anastasija Plotnikova, CEO and Cofounder of Fideum, believes that the market has already absorbed the Fed’s December announcements, viewing the current situation as a “healthy correction” within the broader bull cycle.

She notes the slower rate cut pace, concerns over sticky inflation and overall resilience in the U.S. economy as major sentiment driversL

“I do not believe there is a drastic vibe shift, this was expected conclusions from the Fed and market has priced it in,” she said.

Lee Bratcher, President of the Texas Blockchain Council (TBC), echoes this sentiment, describing the reversal as “a temporary dip in what has been an overall remarkable bull run for crypto.”

Bratcher further points to “increased institutional interest” and a pro-crypto president as drivers of long-term market strength:

"With inflation fears remaining high, investors are likely to turn to safe-haven assets which can cause short-term draw downs for risk assets but those are typically short-term jitters that quickly get priced in."

Also Read: Gary Gensler Says 10,000-15,000 Projects Won’t Survive, Crypto Market Is ‘Wrapped Up In Sentiment’

Is The Government Dumping Its Bitcoin A Cause For Concern?

The announcement that the Department of Justice has been approved to sell $6.5 billion worth of Bitcoin seized from the Silk Road has created further uncertainty.

Liou stated that this led to a further sell-off in crypto markets when the news broke, noting that the government is yet to proceed with the actual sales.

Howell, while acknowledging that it’s “not exactly bullish news,” puts the sale into context, highlighting the high daily trading volume of Bitcoin.

"While the roughly 69,420 BTC that the DOJ plans on selling won’t go unnoticed, as long as they don’t try to sell it all on one day it should have limited impact on the market,” Howell noted.

Plotnikova sees a parallel between these sales and previous sales by the German government, emphasizing that “All that BTC was absorbed by the market and it did affect the price but only temporarily.”

Plotnikova adds that it was naive to expect that DOJ would allocate these BTC to a strategic Bitcoin reserve.

She notes that if the sale is not complete until the new administration is sworn in, there might be some unexpected changes.

Bratcher believes that the sales represent a “moderate sell pressure” on Bitcoin but encourages the Trump administration to intervene.

"Trump should put pressure on the Biden Administration not to sell the Bitcoin by making the general public aware of this pending transaction that would truly be the US shooting ourselves in the foot," he said.

Is The Inauguration Buy Or Sell The News?

Looking ahead to the upcoming presidential inauguration, experts offer varied predictions.

Liou suggests the market is waiting to see the incoming administration's policy moves and that a "direction" could be found soon after the inauguration, depending on the policies and appointments.

Howell believes that Trump’s presidency is “fully priced in,” adding that if something were to prevent Trump from taking office, his VP, J.D. Vance, would likely be even more bullish for the market.

Beltran anticipates a potential “sell the news” scenario, where investors might take profits, despite the long-term crypto outlook being cautiously optimistic.

According to Beltran, the market has likely already priced in Trump’s pro-crypto policies, making a significant pump on inauguration day is unlikely.

Plotnikova expects a period of "de-risking" from markets as investors "wait and see" what Trump will deliver.

She also adds that the incoming administration is very bullish on crypto assets, preferring a predictable and friendly regulatory environment, and expects bullish sentiment to eventually prevail.

Bratcher sees pro-crypto sentiment, saying that, “If we see market structure and stablecoin legislation along with a U.S. Strategic Bitcoin Reserve, there is no reason why the bull market wouldn't extend throughout 2025.”

Was $108,000 The Top?

Asked for their opinion on whether the $108,000 price point was the peak for this cycle, experts m

Howell states a 1% chance, a sentiment echoed by Bratcher, who stated that there is a “99% chance” that this is not the high for the cycle.

Beltran admits that $108,000 represents a significant resistance level, but believes higher prices going forward are likely.

Plotnikova is very bullish, saying that $200,000 could be surpassed by the end of 2025.

While the short-term outlook remains volatile, experts believe that underlying factors support continued growth in the long term.

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