Bitcoin is on the decline as Trump raises rates to 15%, but recovery is still possible

After the American president Donald TrumpThe lights just went out during the last rate change. Bitcoin [BTC] tried to stay calm, but couldn’t.

What happened?

President Trump announced on February 21 that global rates would rise to 15% with immediate effect.

Bitcoin briefly rose towards $68K in the hours surrounding the announcement, but this move did not last long.

Source: TradingView

Ethereum [ETH] also fell, while TOTAL3 (which tracks the total crypto market cap excluding BTC and ETH) fell about 0.29%. There is weakness on the altcoin board.

Wenny Cai, COO at SynFutures, told AMBCrypto about the same thing:

“Crypto reacts like a high-beta liquidity proxy. Bitcoin falling mid-$60K isn’t just low sentiment. That’s what happens when positioning meets a stronger dollar and less forgiving interest rate expectations.”

The tariff increase followed a court decision that limited Trump’s use of emergency powers, although he cited other trade laws to justify the increase.

Critics, including attorney Adam Cochran, argued that these laws limit how long and how broadly such rates can be applied.

It’s not as bad as it seems

Sentiment has fallen thanks to the Fear and Greed Index traps to levels of “extreme anxiety” at the time of writing. Investors are retreating and expecting even more negative consequences.

Cai added,

“Markets are digesting a more aggressive reading of the Federal Reserve’s latest minutes… Equities have softened and bidding has returned to cash-like instruments and short-term Treasuries.”

Source: Coinmarketcap

But one look at the numbers shows that these moments did not last forever.

Economist Timothy Peterson recently noted in an X-post that the long-term prospects for Bitcoin are hopeful.

According to his analysis, which tracks performance since 2011, when at least half of the past two years were positive, Bitcoin traded higher ten months later about 88% of the time.

Source:

On average, returns during those periods reached no less than 82%.

Peterson believes Bitcoin could rise significantly from current levels, potentially reaching around $122,000 over time. So while fear is currently dominating the market, there may still be light at the end of the tunnel.

Final summary

• Bitcoin’s price fell after Trump’s 15% rate shock, but BTC has risen 88% of the time in similar circumstances.
• With Crypto Fear & Greed at 14, this dip could just be panic.