Bitcoin Tops $116,000 as Majority of Economists Predict Fed Rate Cut

Bitcoin struggles to stabilize above $115,000 after the Federal Reserve cut rates by 25 basis points and signaled further easing through 2025, highlighting dovish economic concerns.

BTC

Summary

Bitcoin attempted to maintain levels above $115,000 following the U.S. Federal Reserve’s 25 basis point rate cut, lowering the benchmark range to 4.0%–4.25%. The Fed projected an additional 50 basis points of cuts through 2025 amid slowing job gains, higher unemployment, and lingering inflation concerns. Despite the dovish policy stance, Bitcoin’s reaction was muted, with traders cautious about inflation risks and broader economic conditions. Open interest in Bitcoin futures spiked after the announcement, while spot market volumes continued to decline, signaling leveraged positioning rather than genuine demand. The divergence raises questions over the sustainability of Bitcoin’s current levels as the market braces for potential volatility.

Terms & Concepts
  • Basis Point (BPS): A unit equal to 1/100th of a percentage point, used to measure interest rate changes.
  • Open Interest: The total number of outstanding futures or options contracts that have not been settled, often used as an indicator of market activity.
  • Spot Market: The market where assets such as Bitcoin are traded for immediate delivery, contrasting with futures or derivatives markets.