Sign up now for CryptoCodex<\/a>\u2014A free newsletter for the crypto-curious<\/p>\n The bitcoin price has plunged from an all-time high of $124,000 per bitcoin just last week, dropping around 10% to $114,000, while ethereum and Ripple\u2019s XRP have seen similar declines despite U.S. president Donald Trump dropping a surprise $12.2 trillion crypto bombshell<\/a>.<\/p>\n Bitcoin and crypto\u2019s decline, coming just as JPMorgan makes a game-changing Federal Reserve flip<\/a>, follows Wall Street giants issuing a warning that the recently passed Genius Act stablecoin bill could trigger a $6.6 trillion flood of account withdrawals.<\/p>\n Sign up now for the free CryptoCodex<\/a>\u2014A daily five-minute newsletter for traders, investors and the crypto-curious that will get you up to date and keep you ahead of the bitcoin and crypto market bull run<\/p>\n ForbesTreasury Secretary Issues Surprise September Fed Prediction After U.S. Bitcoin Reveal Triggered Wild Price SwingsBy Billy Bambrough<\/a> JPMorgan Chase chief executive Jamie Dimon is one of the most outspoken critics of bitcoin, but has embraced the underlying technology that powers dollar-pegged stablecoins.<\/p>\n Getty Images<\/p>\n U.S. banking groups that count Wall Street giants such as JPMorgan and Bank of America as members have urged Congress to close a loophole in the recently passed Genius Act stablecoin bill that allows issuers of the dollar-pegged cryptocurrencies to offer yields via affiliates, warning it could trigger huge account deposit flight that would undermine the banking system.<\/p>\n 08\/19 update: The bitcoin price and crypto market has swung wildly as fears swirl a widespread crypto market crash could be gathering pace.<\/p>\n The bitcoin price dropped towards $113,000 before bouncing back to around $115,000, dragging down the wider crypto market that\u2019s seen $250 billion in value wiped out since last week.<\/p>\n \u201cCryptocurrencies traded sharply lower,\u201d David Morrison, senior market analyst at Trade Nation, said in emailed comments. <\/p>\n \u201cBitcoin continued to pull back away from Thursday\u2019s all-time high just below $124,500. Ethereum came under heavier selling pressure, dropping over 5%. These losses highlight the continued volatility within the crypto sector. The bigger question is whether this is simply a round of profit-taking following the sharp rally over the first two weeks of August, or if it is the beginning of a deeper and more protracted sell-off.\u201d<\/p>\n The closely-watched crypto fear and greed index has swung from a reading of 68 last week to just 56, its lowest reading since the bitcoin price dropped to under $112,000 at the beginning of August and putting it on the verge of \u201cfear\u201d territory.<\/p>\n This week, the three-day Jackson Hole economic policy symposium begins in Wyoming, with Federal Reserve chair Jerome Powell\u2019s Friday speech topping the agenda as traders brace for what\u2019s widely expected to be a Fed interest rate cut in September.<\/p>\n \u201cMarkets are shoring up their focus on upcoming commentary from the Fed chair at the Jackson Hole Symposium,” Joel Kruger, market strategist at LMAX Group, said in emailed comments. \u201cFed reserve timelines and geopolitical developments are shaping flows across equities, FX, and crypto.\u201d<\/p>\n Last week, Treasury secretary Scott Bessent said the Federal Reserve could cut interest rates by 50 basis points in September<\/a>, mirroring a surprise 2024 interest rate cut that powered a bitcoin price boom into the November election.<\/p>\n \u201cIf Powell signals a slower path to easing at Jackson Hole, markets could reprice aggressively, tightening financial conditions and putting pressure on crypto prices in the near term,\u201d Carolane de Palmas, market analyst at Activtrades, said in emailed comments.<\/p>\n \u201cWhile bitcoin is often framed as \u2018digital gold,\u2019 its short-term performance is still highly sensitive to liquidity cycles. Traders need to recognize that Fed policy directly shapes dollar liquidity, and by extension, influences the flows into and out of bitcoin. If the Fed looks more cautious on rate cuts, we could see reduced momentum in the crypto space through the fall. But there\u2019s a second layer here\u2014beyond just liquidity. The symbolism of Jackson Hole matters. This is where Powell sets the tone for policy direction, and any hint that rate cuts are still firmly on the table could restore confidence in the crypto rally. On the flip side, if the Fed appears hesitant because of tariff-driven inflation concerns, bitcoin could remain trapped in consolidation until a clearer macro catalyst emerges. In the next quarter, bitcoin\u2019s path will be closely tied to Fed expectations.\u201d<\/p>\n In April, a Treasury Department report estimated that stablecoins could trigger up to $6.6 trillion in deposit outflows, depending on whether they can offer interest or yield, with the stablecoin market expected to grow to $2 trillion by 2028, up from $280 billion today.<\/p>\n “Congress must protect the flow of credit to American businesses and families and the stability of the most important financial market by closing the stablecoin payment of interest loophole,” the report, posted<\/a> to the Bank Policy Institute website, and addressed to lawmakers, read.<\/p>\n \u201cBanks power the economy by turning deposits into loans. Incentivizing a shift from bank deposits and money market funds to stablecoins would end up increasing lending costs and reducing loans to businesses and consumer households.\u201d<\/p>\n The plea to lawmakers was also signed by the American Bankers Association, Consumer Bankers Association, Independent Community Bankers of America and the Financial Services Forum.<\/p>\n Stablecoin adoption wars are heating up following the passage of the Genius Act that laid down rules of the road for the crypto-based dollars.<\/p>\n Tether\u2019s USDT remains the dominant stablecoin but is facing a tidal wave of competition from all angles, including Wall Street giants themselves, technology companies such as Facebook\u2019s Meta, as well as financial technology companies like PayPal and Stripe.<\/p>\n Earlier this year, David Sacks, a technology investor and U.S. president Donald Trump\u2019s crypto czar, said on the All In Podcast he hosts with three other investors that he hopes that eventually the rules will swing in favor of stablecoin issuers, allowing them to directly offer interest to stablecoin holders.<\/p>\n Trump\u2019s sons Eric and Don Jr have publicly said their World Liberty Financial crypto project is a direct challenge to Wall Street following their claims of being \u201cde-banked\u201d in the aftermath of Trump\u2019s 2020 election loss. \u201cHonestly, I would love to see some of the big banks go extinct, because, honestly, they deserve it,” Eric Trump said<\/a> in May.<\/p>\n Sign up now for CryptoCodex<\/a>\u2014A free newsletter for the crypto-curious<\/p>\n![\"bitcoin,](\"https:\/\/www.newsbeep.com\/us\/wp-content\/uploads\/2025\/08\/1755611234_164_960x0.jpg\")
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