Bitcoin Tumbles Below $77,000 Amidst Fed Rate Hike Worries

The recent speech by Federal Reserve Governor Christopher Waller in Frankfurt has sent shockwaves through the cryptocurrency market, with the price of Bitcoin (BTC) plummeting below $77,000.

This decline comes as traders respond to Waller's signals of openness to future rate hikes, which have led them to price a quarter-point Fed hike as early as October. The shift in Waller's stance has reframed the Federal Reserve hike debate within the FOMC, with a 40% chance of a 25-basis-point hike now priced into the market.

The hawkish pivot by Waller comes amidst deteriorating macro conditions, including rising real yields and a firming dollar. These factors have eroded demand for non-yielding assets such as Bitcoin, contributing to its price drop.