Well, let’s talk about the elephant in the room—Bitcoin recently dipped below $100,000 again, and the crypto market is in chaos. Everyone’s pointing fingers at DeepSeek, the Chinese AI startup that’s been making waves with its ridiculously affordable AI model - click here for further information about this AI app. But is DeepSeek really the main culprit here? Or are we all just ignoring the bigger forces at play?

Let’s break it down...

DeepSeek dropped a bombshell by releasing an open-source AI model that would rival with GPT-4 at a fraction of the cost... This has sent shockwaves through the tech sector, especially for companies like Nvidia, whose stock took a nosedive. And guess what? When tech stocks sneeze, crypto catches a cold. Bitcoin and other cryptos often move in tandem with tech stocks, so it’s no surprise...

But here’s the thing: is DeepSeek really the main reason for this dump? Or are we just using it as a scapegoat?

The FOMC meeting: the silent killer...

Let’s not forget—today is the US Fed’s FOMC meeting. Traders are on edge because no one’s expecting a rate cut anytime soon. With strong economic data and stable inflation, the Fed might even hint at keeping rates higher for longer. And we all know what that means for risk assets like crypto.

Historically, FOMC meetings have been a major catalyst for Bitcoin’s price swings. If the Fed comes out with a hawkish tone, we could see even more downside. So, is the market really dumping because of DeepSeek, or is it just prepping for the Fed’s next move?

What’s really going on?

Here’s my take: DeepSeek definitely shook the market, but it’s not the only reason for the dump. The crypto market is a complex beast, and right now, it’s being squeezed by multiple factors—DeepSeek’s disruption, tech stock volatility, and the looming FOMC meeting.

So, are we all wrong to blame DeepSeek? Maybe. Or maybe we’re just not looking at the full picture.

What’s next?

Keep an eye on the Fed’s decision today. If they signal a more hawkish stance, we could see more pain in the crypto market. But if they surprise us with a dovish tone, we might get some relief.

In the meantime, let’s not jump to conclusions. DeepSeek might be a part of the story, but it’s not the whole story. The crypto market is always full of surprises, and this time is no different.

What do you think? Is DeepSeek the real villain here, or are we all missing something? Drop your thoughts below! 👇