- The Federal Reserve reduced its benchmark interest rate by 25 basis points on September 17, but crypto prices did not see major changes.
- Bitcoin traded between $115,000 and $117,000, while Ether saw slight fluctuations after the announcement.
- Analysts say the market had already anticipated the rate cut, so little price movement followed the decision.
- Experts view the interest rate cut as a positive sign for risk assets like cryptocurrencies, expecting further cuts this year.
- Future performance of crypto markets may depend on key economic indicators and the independence of central bank policy.
The Federal Reserve announced a 25 basis point reduction in its benchmark interest rate on September 17. Following the announcement, major cryptocurrencies, including Bitcoin and Ether, did not show significant price movements.
According to Coinbase data, Bitcoin traded between $115,000 and $116,000 when the Federal Open Market Committee released its statement at 2 p.m. EST. In the hours after, Bitcoin briefly dropped below $115,000 before reaching around $117,000 by 7 p.m. The price of Ether dropped from $4,600 to $4,430 before climbing back to nearly $4,620.
Some analysts explained that the anticipated rate cut had already been factored into the crypto prices. “Today, we did not see much volatility as the Fed interest decision had been long anticipated–the market was seeing a 25bps cut with above 90% probability,” said Julio Moreno, head of research at CryptoQuant. Brian Huang, cofounder of fintech firm Glider, added via email that “Crypto markets had widely priced-in today’s rate cut, and so BTC and ETH are flat on the day.”
Several industry experts called the rate cut a positive sign for markets. “The Fed’s rate cut today is a positive signal that liquidity is back on the table, resulting in a short-term boost in sentiment,” said Qin En Looi, managing partner at Onigiri. Moreno also noted that such moves from the Fed generally support risk assets like cryptocurrencies and could mark the start of a rally into the fourth quarter if more rate cuts occur.
Looking ahead, analysts highlight the central bank’s ongoing influence on digital asset markets. “When Powell blinks, risk assets breathe, and Bitcoin inhales deeper than most,” stated Doug Colkitt, a founding contributor at Fogo. Thomas Perfumo, global economist at Kraken.com/” target=”_blank” rel=”nofollow noopener noreferrer” aria-label=”Kraken”>Kraken, said “The Federal Reserve and markets appear aligned on the expected path of rate cuts through late 2025 and into 2026, a backdrop that remains broadly supportive for risk assets, including crypto.”
Greg Magadini, director of derivatives for Amberdata, emphasized the importance of the Fed’s policy independence, especially with expected leadership changes in 2026.
While the actions of the U.S. central bank are expected to impact cryptocurrencies, some experts noted that innovation within the crypto sector itself will have a lasting effect on prices. “Macro is the wind, and crypto innovation is the engine. Rate cuts might kick off the next leg, but real adoption is what keeps it running over time,” Colkitt said.
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