White House Predicts 50+ bp Fed Cut — Crypto Markets Poised for Volatility
White House National Economic Council Director Kevin Hassett said a Fed interest-rate cut of 50 basis points or more is a strong possibility ahead of an imminent Federal Reserve decision scheduled for 19:00 UTC. Traders should watch the cut size (25 vs 50+ bps), Fed forward guidance, and economic outlook language. A sizeable cut typically weakens the US dollar, lowers yields and can push capital into risk assets including cryptocurrencies — historically positive for Bitcoin and wider digital-asset demand. However, large cuts can also signal serious economic weakness and trigger volatility or risk-off moves. Practical trading advice: manage leverage, predefine entry/exit levels, and monitor DXY and Treasury yields for immediate market cues. Key short-term drivers will be the headline cut and market reaction; longer-term direction depends on whether the Fed signals a one-off move or the start of a cutting cycle. This development increases liquidity tailwinds for crypto but raises the potential for sharp intraday swings.
Bullish
A potential 50+ basis-point Fed rate cut is generally bullish for cryptocurrencies because lower interest rates reduce the opportunity cost of holding risk assets, weaken the US dollar, and can drive capital into Bitcoin and altcoins. Historical precedents show that dovish monetary policy and rate cuts often coincide with strong inflows into risk-on assets and higher crypto prices. However, the bullish outcome depends on market expectations: if the cut is smaller than hoped (e.g., 25 bps) or accompanied by cautious forward guidance, markets may ’sell the news’ and trigger short-term declines. A very large cut could also reflect severe economic concerns, producing initial risk-off reactions before liquidity effects take hold. Short-term implication: heightened volatility, strong intraday moves, and risk of leveraged liquidations — so traders should manage leverage and use stop rules. Medium-to-long-term implication: if the Fed signals the start of a cutting cycle, sustained liquidity and weaker dollar dynamics should support broader crypto appreciation; if the move is one-off, gains may be muted or reversed once growth/inflation concerns dominate.