Bitcoin drops to $109K following Fed rate cut of 0.25%: why?

Important points 

• Bitcoin’s price drop accelerated as the Federal Reserve cut interest rates by 25 basis-points.

• The weakness in the crypto market shows that traders have their eyes on macroeconomic factors like inflation and a weakening job market, even though they believe interest rates will be cut until 2026. 

BitcoinBTCPrice fell to $109 200 ahead of US Federal Reserve’s decision on Wednesday to lower interest rates 25 basis points. Although traders may not have noticed, anticipated a degree of risking-off BTC’s decline of 6% to $116.400 from its previous Monday’s high may be more drastic than expected. This is especially true when analysts were expecting a rate cut by 25 basis points. 

Fed dot plot shows three reductions in baseline for 2025. Goldman Sachs analysts have already predicted at least two additional 25 basis-point cuts between March 2026 and June 2026. This would put the Fed benchmark at 3% to 3.25 percent. 

Hyblock is a company that provides crypto analysis.

“Recent history has shown that the FOMC leads to a price drop in BTC, followed by a move up. This was the case in both the no rate change and rate cut (last one) scenarios. If price does dip post-FOMC and signs of bullish confluence emerge, such as bid-heavy orderbooks, it would likely present good opportunities for investors.” 

Investors’ attention has been shifted from the rate cut to the rate reduction. “what comes next, beyond the cuts” Viewpoint. Tradesmen are constantly thinking about factors such as job losses in the US, President Trump’s trade war and the future impact on artificial intelligence.

Related: Price predictions 10/29: BTC, ETH, BNB, XRP, SOL, DOGE, ADA, HYPE, LINK, BCH

These factors will likely impact Bitcoin’s price more than today’s interest rates cut which, after all, was essentially already priced in. There was 100% consensus on a 0.25 percent cut. 

In the FOMC Statement, it was confirmed that Fed will stop shrinking their balance sheet by Dec. 1. This marks the end to quantitative easing. 

The article is not intended to provide investment advice. Each investment or trading decision involves some risk. Readers should do their own research before making any decisions.