- Published on
Bitcoin absorbs Fed rate hike as officials see more tightening
- Authors
- Name
- DeepHorus
Bitcoin held near $76,000 on Wednesday, shrugging off the US Federal Reserve's first interest rate increase since 2023. The central bank raised its benchmark rate by 25 basis points to a target range of 3.75% to 4%, a move that traditionally pressures stocks and other risk assets. By the time of writing, Bitcoin was trading at $76,663, up 1.35% over 24 hours, broadly in line with its pre-announcement level. US equities, by contrast, slipped during the same session.
The hike marked the Fed's first tightening step in more than three years and was aimed at addressing persistently high inflation. The Federal Open Market Committee voted unanimously in favor of the increase. Crypto markets, which had widely anticipated the decision, showed little immediate turbulence. "The initial reaction suggests the Fed's decision was largely anticipated by crypto markets," said Cooper Duschang, research analyst at Talos.
Speaking at the post-meeting press conference, Fed Chair Kevin Warsh said inflation remains too high while the US economy appears to be strengthening. The Fed's updated economic projections showed a majority of officials expect further tightening. According to those projections, 16 of 18 FOMC participants expected at least one more rate increase before the end of the year. That prospect could test Bitcoin's resilience in the months ahead.
"Bitcoin has remained relatively resilient, holding broadly around pre-announcement levels even as equities moved lower," Duschang added. He noted that while headline price action was muted, activity beneath the surface was more nuanced. Perpetual futures shifted toward net selling, led by roughly $82 million in Bitcoin and $68 million in Ether within a single hour. At the same time, Bitcoin recorded about $15.5 million of net spot buying.
Duschang also pointed to significant exchange flows following the rate decision. Around 2,170 Bitcoin moved onto exchanges after the hike, followed by a withdrawal of 1,260 Bitcoin. "Rather than a uniform risk-off response, investors appear to be actively repositioning as they digest the Fed's message," he said. The key question, he added, is whether Bitcoin's resilience and spot demand hold as attention shifts to the prospect of further tightening.
Andrew Melville, head of research at Block Scholes, cautioned that another rate increase would be a "more hawkish surprise than today's 25bp hike." His view underscores the risk that markets have priced in the current move more fully than what may follow. Martin Lee, market insights lead at DWF Labs, said the renewed hawkish stance of "higher for longer" rates would push risk-on assets toward "repricing this new reality."
With 16 of 18 officials projecting additional tightening in 2026, crypto traders are bracing for potential volatility. Bitcoin's ability to absorb the first hike without a sharp drawdown suggests spot demand remains a supporting force. Whether that cushion holds through subsequent meetings will depend on incoming inflation data and the Fed's evolving policy path.
