Key Takeaways
- Bitcoin popped a bit after today’s Fed decision, though around the close of regular trading the crypto coin had given back some of its gains.
- Crypto investors may have been signaling both relief that the Fed delivered its rate cut as expected, and concern that its plans aren’t as aggressive as some hoped.
Bitcoin got some of what it wanted from the Fed today. But what’s next?
The price of bitcoin (BTCUSD) climbed toward $94,000 as the Federal Open Market Committee cut its target rate by a quarter percentage point, as widely expected, then handed back a few grand, perhaps a signal of disappointment that the outlook for future cuts wasn’t clearer. Still, the prospect of more accommodative policy ahead may be helping hold crypto off recent lows. (Stocks, meanwhile, climbed today.)
Analysts and investors have been recalibrating their expectations for crypto lately, with the digital assets in the doldrums since the top of October. Now, it seems, the Fed is in the driver’s seat with regard to what’s next for the world’s largest cryptocurrency, which as of today is little-changed for 2025 after a wild run.
WHY IT MATTERS
Bitcoin is a multi-faceted asset, sometimes behaving like a hedge, and other times, like a risk asset. Its recent sensitivity to monetary policy by the Fed could be a signal that it could get out of its recent rut in 2026.
Bitcoin “is a bit of a chameleon, because there will probably be a time when it acts like gold, but right now it acts a lot more like it’s sensitive to monetary policy and the business cycle,” Fundstrat Head of Research Tom Lee told CNBC on Wednesday. “Both are about to turn up.”
Standard Chartered, a UK-headquartered bank, cut its year-end bitcoin price target by half in a report published Tuesday—but it’s still bullish, even in the short-term.
It trimmed its year-end target for bitcoin to $100,000 by the end of the year, from $200,000, and its 2026 target to $150,000 from $300,000. The firm characterized bitcoin’s recent 36% drop from peaks as “normal,” but said that price action also pushed it to recalibrate its outlook.
Ultimately, the crypto market is in search of buyers. Much of that heavy lifting will be done by crypto exchange-traded funds, according to Geoff Kendrick, Standard Chartered’s global head of digital assets research, with the recent news that Vanguard opened up its brokerage platform to crypto ETFs a promising sign. Kendrick thinks bitcoin will return to making new highs but sees it happening “more slowly” than before.
Meanwhile, some big digital asset treasury companies are still buying. Strategy (MSTR) recently added more than 10,000 bitcoin to its stockpile, assuaging concerns that the company was poised to sell. Bitmine Immersion Technologies (BMNR) picked up 138,452 ether.
And Twenty One Capital (XXI), a bitcoin company of which stablecoin provider Tether is a majority owner, recently landed in public markets via a merger with a special purpose acquisition company.
Chief Jack Mallers, who also founded Bitcoin payments app Strike, said in an interview with CNBC that the company intends to “acquire as much bitcoin as [it] possibly can.”