Expectations of cuts in the Federal Reserve's interest rates significantly impact the cryptocurrency market, including Bitcoin, which reflects changes in its pricing.
Impact of Rate Cut Expectations on the Market
Traders expect two rate cuts from the Federal Reserve by December 2025, influenced by macroeconomic indicators such as inflation and new tariffs set by President Trump. Analysts report heightened trader activity as they adjust their portfolios in anticipation of these changes. According to Federal Reserve Chair Jerome Powell, 'The probability of the Fed keeping interest rates unchanged in September is 35.4%, and the cumulative probability of a 25 basis point cut is 62.6%.'
Historical Links between Rate Cuts and Cryptocurrencies
Rate cuts have historically bolstered the cryptocurrency market, as evidenced in 2019-2020, prompting significant rallies for Bitcoin and Ethereum. Analysis shows that market volatility can significantly increase in anticipation or disappointment regarding rate changes.
Current Situation of Bitcoin Market
At present, the price of Bitcoin stands at $113,371.74, with a market capitalization of $2,256,145,293,314.00 and a dominance of 61.03%. In the last 24 hours, the price dropped by 3.22%, with trading volume reaching $89,152,821,502. The circulating supply now totals 19,900,421 out of a maximum of 21,000,000. Historical data from CoinMarketCap indicates that Bitcoin prices have increased by 17.75% over the last 90 days.
Expectations of the Federal Reserve's rate cuts continue to influence the cryptocurrency market, particularly Bitcoin. Analysts underscore the importance of these factors in affecting liquidity and market sentiment.
