The traditional market now seems to be playing a much bigger role in Bitcoin’s pricing. Investors are waiting to see what happens with U.S. interest rates before betting on BTC’s next moon launch.
“I think there is still some potential upside this cycle, but isn’t it a strange world where Bitcoin’s hopes and dreams hinge on the actions of the very central banks it was created to render obsolete,” said Joel Valenzuela, a core member of Dash DAO (DASH).
Bitcoin’s early ideology was a reaction to centralized monetary failures. Its creators envisioned it as a parallel system—money not issued or controlled by governments, resistant to inflation, censorship, and manipulation, relying instead on cryptography and code.
Bitcoin’s all-time high was reached on August 13, when the king of cryptocurrencies hit $124,457 before settling near $113,000 two weeks later. Many new investors piled in on the record high headlines. Now, those latecomers are underwater, and analysts warn that rallies back to the $120,000 mark could face heavy selling pressure as traders look to exit at breakeven, Benzinga reported on Thursday, Aug. 28.
Bernstein securities analyst Gautam Chhugani, a long-term Bitcoin bull, sees support at around $110,000 with room to rally to $200,000 next on U.S. interest rate moves. The next Federal Reserve Open Market Committee meeting is set for September 16–17. The Fed will issue its policy statement on the 17th, followed shortly by a press conference by Chairman Jerome Powell.
CME FedWatch Tool shows traders pricing in an 85.3% chance of a 25‑basis-point cut.
“Bitcoin around $120 thousand was more likely a reaction to events at Jackson Hole,” said Marvin Bertin, co founder and CEO of Maestro, an enterprise-grade Bitcoin Finance (aka BitcoinFi) infrastructure provider for financial institutions.
The new high-water marks for BTC signal the asset’s deeper integration into the global financial system, with Wall Street playing a bigger role than ever in marketing Bitcoin to new investors.
“Traders are focused on short-term price movements, but institutions are increasingly viewing Bitcoin as a foundational technology for a new on-chain financial economy, not just as a digital gold asset,” said Bertin. “A move above $130 thousand would be a key milestone, but the real bullish sign is going to be the ecosystem’s maturation. That is what is laying the groundwork for Bitcoin to become a programmable financial layer,” Bertin said.
Bitcoin Price vs. Utility: Beyond the Speculative Trade
The argument for Bitcoin has always been about utility, and not about Fed moves.
If BTC is worth $100,000, what can it actually be used for? Who is using it? While your electric utility or car insurance company probably won’t accept Bitcoin, investors can gamble on its rise, sell for dollars, and cover bills that way—hoping gains outpace inflation.
But outside of speculative plays, Bitcoin is not yet a serious part of the global trading system or the American consumer market. Few are buying houses or paying rent in BTC. Even fewer are importing cars from Mexico and settling in Bitcoin. For now, it’s more of a speculative investment—one that is quickly being pulled into traditional markets with new financial products and Wall Street’s growing embrace of the tokenization of real world assets being embraced by Wall Street.
By “ecosystem,” Bertin means everything being built around Bitcoin – like layer-2 blockchains, DeFi protocols, tokenization projects and custody solutions to name a few.
From Digital Gold to Programmable Finance?
Bitcoin was designed as “digital gold,” but compared to Ethereum it’s limited in programmability because it lacks native smart contracts. The rise of Bitcoin Layer-2 ecosystems that let developers build applications on its security base is the real bull case for long-term utility.
If this succeeds, Bitcoin won’t just be a store of value. It could become the settlement layer of the internet’s financial system—shifting from “gold under your mattress” to “the rails for global programmable finance.”
Already, over 150 publicly traded firms now hold nearly 1 million BTC in their treasuries, according to CoinMarketCap.
“Bitcoin’s chilling near $120,000, and it’s like everyone’s holding their breath,” said Mete Al, the Istanbul-born CEO and co-founder of ICB Labs based in Dubai. “Traders are waiting to see if Powell really drops interest rates and by how much. Bitcoin could easily make a run for $130,000 if we see a bump down in rates,” he said.
Powell could keep rates stable in the 4.25%–4.50% range if core inflation rises above July’s 3.1%. Higher tariffs that began in August could also feed short-term inflation into the autumn.
Should the Fed hold steady, Bitcoin prices might stall, Al said.
“Either way, Bitcoin’s fundamentals are rock solid, with tight supply and big institutions still piling in,” Al added. “What’s wild is how Bitcoin is now moving in sync with (tech) stocks. It’s not just a crypto thing anymore—it’s become a legit part of the global market scene. That’s a huge leap from where it started.”
The writer is an investor in Bitcoin through the Grayscale Bitcoin Trust. Feature image is author generated.
Benzinga Disclaimer: This article is from an unpaid external contributor. It does not represent Benzinga’s reporting and has not been edited for content or accuracy.