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On Monday, the price of bitcoin slid below $90,000, representing the lowest level in two months for the world’s top cryptocurrency. The drop was driven by concerns that the Federal Reserve might delay interest rate cuts and broader macroeconomic factors like persistent inflation and fears of stagflation.

Bitcoin is currently trading at more than $93,000 at the time of writing, despite the fact that the world's leading cryptocurrency plummeted over 9% in the past week.

"We need to remember bitcoin and crypto generally is a volatile beast,” said James Toledano, Chief Operating Officer at Unity Wallet, who added that bitcoin investors were in a profit-taking mode following bitcoin reaching a new all-time high of more than $108,000 this past December.

"Macroeconomic conditions have also weighed on the market,” he explained. “Sticky inflation, robust economic data, and the Federal Reserve’s cautious approach to interest rate cuts have curbed liquidity, limiting appetite for speculative assets like bitcoin. Additionally, fears of stagflation and uncertainty surrounding Trump’s forthcoming policies may have dampened enthusiasm which can lead to short-term volatility for an already highly volatile asset.”

Indeed, Toledano described the price drop as “business as usual” for the cryptocurrency and cautioned investors not to use it as a signal marking the end of a bull run.

“The inauguration of President-elect Trump is just seven days away and could be a pivotal moment, with markets anticipating announcements of pro-crypto policies that might spark renewed buying interest,” Toledano said. “Institutional accumulation, as reflected in falling exchange reserves also supports the view that demand remains strong despite low trading volumes.”

"If Trump’s policy rollout aligns with market expectations, the bull run could regain momentum. Conversely, any disappointments or external shocks might prolong consolidation or trigger further corrections,” he said.