Federal Reserve Lowers Interest Rates: Effects on Bitcoin

Written by Ohris M. Greyoon, Blockchain & Crypto Expert

Source: Coinmarketcap

Updated: 1 day ago

Fed's Rate Cut Impact: The Federal Reserve's decision to cut rates by 25 basis points in December 2025 led to significant volatility in Bitcoin's price, which briefly surged above 94,000 USD before settling around 92,000 USD.
Market Reactions: Despite the fluctuations, institutional support for Bitcoin remains strong, with market participants viewing the Fed's cautious approach as a potential stabilizer for cryptocurrency futures and ETFs.
Cross-Asset Correlation: Bitcoin's price movements were closely correlated with traditional risk assets, reflecting its behavior as a speculative asset amid policy changes, similar to past reactions to Fed policies.
Historical Context: The current volatility in Bitcoin mirrors previous instances of significant price movements in response to Federal Reserve actions, highlighting its sensitivity to monetary policy changes.

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Ohris M. Greyoon

Ohris M. Greyoon holds a Master’s in Computer Science from MIT and has 10 years of experience in blockchain technology and cryptocurrency markets. A pioneer in decentralized finance (DeFi) analysis, he leads Intellectia’s Crypto News, offering cutting-edge insights into digital assets.