Markets are pricing a 92.5% chance that the Federal Reserve will raise interest rates for the first time in three years, after strong employment data and persistent inflation. Bitcoin has remained between roughly $76,000 and $80,000 for 24 days, while volatility fell to a one-month low. Chris Sullivan of Hyperion Decimus said the bond market had already priced in the expected hike, making a decision not to raise rates a potentially bigger surprise for investors. Crypto market participants have reduced risk ahead of the meeting, with Talos recording a 28% net buying tilt toward stablecoins (crypto tokens designed to track stable values), compared with an average 8% selling tilt around previous Federal Open Market Committee meetings. Bitcoin buying conviction declined to 3% from 10%, while the source also references ether without providing a comparable figure. The main question is where sidelined liquidity moves after the Fed decision. Bitcoin barely moved around the Fed’s last rate hike in July 2023, and K33 Research said open interest (the value of outstanding derivatives positions) in bitcoin futures and perpetuals (futures without expiry dates) remains below its yearly average, limiting evidence of excessive leverage. Oil is another risk, with crude prices up more than 20% over the past five days, according to Mark Connors, chief investment officer at Risk Dimensions. Connors said higher energy prices could intensify inflation and argued that another rate hike would be poorly suited to an oil supply shock. Attention may therefore focus less on the expected hike than on what Fed Chair Kevin Warsh says about the policy outlook afterward.