Bitcoin traders looking to predict the next move of the digital currency’s price should keep a keen eye on policy developments following the Federal Reserve’s recent rate cut announcement, as highlighted by several analysts. The leading cryptocurrency has been experiencing notable fluctuations throughout this month, oscillating between approximately $85,000 and $95,000, as per data. The Federal Open Market Committee issued its latest statement regarding the benchmark federal funds rate at 2 p.m. on Wednesday, December 10. The announcement revealed a widely expected reduction of 25 basis points, adjusting the target range from 350 to 375 basis points. The committee also indicated that it would initiate purchases of “shorter-term Treasury securities.”
Markets did not manage to rally after this announcement, with many viewing the rate cut as a predetermined outcome. Bitcoin prices surged ahead of the Fed’s statement, exceeding $94,000, only to plummet below $90,000 later that evening, according to data. “The third 25 bps fed interest rate cut of 2025 was one of the poorest kept secrets ever,” Tim Enneking stated, adding that it was “Completely priced in.” Katherine Dowling, advisor at Bitwise Asset Management, provided a comparable perspective, stating through emailed commentary that “On the macro front, the most recent interest rate reduction was already priced in, but all eyes are on what this move signals for future decisions and where the Fed may ultimately want to land.”
For anyone keeping an eye on the price movements of the digital currency and attempting to predict future trends, “Policy developments are incredibly important,” stated the Wendy O. Other analysts provided comparable insights, with Joe DiPasquale, CEO of cryptocurrency hedge fund manager BitBull Capital, highlighting that investors’ expectations regarding future Fed policy will significantly influence the performance of digital currencies in the near-term. “Bitcoin’s next move is less about this single Fed cut and more about whether markets buy the story of a shallow easing cycle,” he noted in an email. “If lower real yields and the new liquidity support stick without a real growth scare, that backdrop is still constructive for bitcoin and other high-beta assets,” stated DiPasquale.
Gabriel Selby shared insights on the pivotal influence of the Federal Reserve, directing attention towards liquidity considerations. “Bitcoin initially sold off on hawkish guidance from the Federal Reserve, but the more interesting story is the structural shift in the liquidity cycle,” he stated. “Quantitative tightening is over and the Fed is back to buying Treasuries.” Selby also emphasized that “The next Fed chair could significantly alter market expectations.” Once Trump reveals his selection, that appointee steps into the role of the shadow Fed chair, prompting markets to begin factoring in this individual’s forthcoming policy approach long before they officially assume the position. “If it’s someone like Kevin Hassett, expect rate cut expectations for 2026 to shift meaningfully,” he remarked, referencing the current director of the National Economic Council of the United States. Analysts highlighted the ongoing legislative efforts, particularly the market structure bill aimed at clarifying the jurisdictional boundaries between the Securities and Exchange Commission and the U.S. Commodity Futures Trading Commission concerning digital assets. According to Dowling, the passage of such legislation could not only provide the overall crypto space with greater regulatory clarity but also trigger an influx of institutional capital.