Network economist Timothy Peterson has warned that Bitcoin could face a steep correction if the U.S. Federal Reserve decides to keep interest rates unchanged in 2025. According to Peterson, Bitcoin’s next major decline may not require a dramatic catalyst—simply a lack of rate cuts could be enough to trigger a downturn. Rate Cut Delay Could Trigger Market Downturn “What it needs is a trigger. I think that trigger may be as simple as the Fed not cutting rates at all this year,” Peterson shared on March 8 in a post on X. His statement came just a day after Federal Reserve Chair Jerome Powell reaffirmed that the central bank was in no rush to lower rates, emphasizing the need to wait for greater clarity before making adjustments. Peterson, known for his work on Metcalfe’s Law as a model for Bitcoin’s value, has attempted to estimate Bitcoin’s potential bottom in the next bear market. Using his Nasdaq lowest price forward model, he predicts that if a broader market downturn occurs, the Nasdaq could fall 17% over seven months before stabilizing. Applying a 1.9x multiplier to Bitcoin—based on historical price patterns—he estimates a potential 33% correction for BTC. This would translate to a price drop from its current level of $86,199 to around $57,000. Bitcoin May Not Drop as Low as Expected Despite this estimate, Peterson believes that Bitcoin is unlikely to fall to $57,000 due to aggressive market behavior. He pointed out that in 2022, when many analysts predicted Bitcoin would bottom at $12,000, it only fell to $16,000—about 25% higher than expected. Applying that same logic, he suggests that if Bitcoin’s worst-case scenario is $57,000, the market will likely bottom out closer to $71,000. This price level coincides with Bitcoin’s November 6 valuation, just before Donald Trump’s election victory sparked a rally that sent BTC to $100,000 by December 5. Peterson’s analysis aligns with a January 27 forecast from BitMEX co-founder Arthur Hayes, who predicted a correction to $70,000–$75,000 before a massive rally that could push Bitcoin to $250,000 by the end of 2025. Meanwhile, Blockware Solutions remains bullish on Bitcoin . In December 2024, the firm stated that if the Fed pivots on rate cuts, Bitcoin’s worst-case scenario for 2025 would still be $150,000—a stark contrast to Peterson’s concerns. The post Bitcoin Could Drop to $70K if Fed Holds Rates, Warns Economist appeared first on TheCoinrise.com .
