Bitcoiners were noticeably more upbeat on social media today as the prospect of a US Federal Reserve rate cut in December nearly doubled compared to just a day earlier.
Some crypto market participants speculate that this could be the catalyst that Bitcoin (BTC) needs to halt the asset’s downward trend.
“Let’s see if that’s enough for now to find a bottom here,” cryptanalyst Moritz he said in X’s announcement on Friday, while the price of Bitcoin is trading at $85,071, down 10.11% over the past seven days, according to on CoinMarketCap.
On Friday, odds for a rate cut at the Federal Open Market Committee’s (FOMC) meeting in December nearly doubled to 69.40%, according to on the CME FedWatch tool. Just the day before, on Thursday, it was lower by almost 30.30 percent, to 39.10 percent.
Many in the broader market attributed the jump at least in part to dovish remarks by New York Fed President John Williams, who he said The Fed can cut rates “in the near term” without compromising the inflation target. Bloomberg analyst Joe Weisenthal he said this was the reason why the odds “raised massively”.
The setup looks “fabulously bullish,” says an analyst
However, economist Mohamed El-Erian warned market participants not to “get carried away” by the comments. Meanwhile, the broader crypto community reacted even more harshly. “This would normally be growth,” Mister Crypto he said in X post on Friday.
Fed rate cuts tend to be positive for riskier assets like Bitcoin and the broader crypto market, as traditional assets like bonds and term deposits become less lucrative for investors.
Crypto analyst Jesse Eckel pointed to a sharp rise in the rate and the chance of a reduction he said“If you zoom out, the setting is unfathomably large.”
“I don’t know why we’re going lower,” Eckel said. “We are going from a cycle of tightening to a cycle of relaxation,” he added.
Crypto Analyst Curb he said“Crypto is going to explode in a big way.”
Prospects for a rate cut were previously “misjudged”
Coinbase Institutional he said in X’s post on Friday, “While markets are leaning towards ‘no cut’ this time around, we believe the prospect of a rate cut is actually misjudged. Recent rate surveys, private market data and real-time inflation indicators suggest otherwise.”
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“Since the October FOMC meeting, futures prices have shifted from expecting a 25 basis point cut to favoring a hold, largely due to rising inflation concerns,” Coinbase Institutional said.
“However, studies show that tariff increases can reduce inflation and increase unemployment in the short term, acting as negative demand shocks,” it added.
It comes as sentiment across the crypto market has remained weak over the past seven days. Crypto fear and greed Indexwhich measures overall crypto market sentiment, posted an “Extreme Fear” rating of 14 in its Friday update.
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