Bitcoin maintained its position near pre-announcement levels around $76,000 on Wednesday, showing minimal immediate reaction to the U.S. Federal Reserve’s decision to raise its benchmark interest rate for the first time since 2023.
Fed Raises Rates by 25 Basis Points
The Federal Open Market Committee voted unanimously to increase rates by 25 basis points, setting a new target range of 3.75% to 4%. This move, typically associated with pressure on stocks and risk assets, came as the central bank continues to address persistently high inflation.
At the time of writing, Bitcoin was trading at $76,663, representing a 1.35% gain over the previous 24 hours.
Market Reaction Largely Anticipated
Cooper Duschang, research analyst at Talos, noted in comments shared with Cointelegraph:
“The initial reaction suggests the Fed’s decision was largely anticipated by crypto markets. Bitcoin has remained relatively resilient, holding broadly around pre-announcement levels even as equities moved lower.”
Equities Decline While Bitcoin Holds
U.S. stocks slipped on Wednesday following the rate decision. Crypto analysts caution that Bitcoin’s current resilience could face fresh tests if the Fed implements additional rate hikes before year-end.
During the FOMC press conference, Fed Chair Kevin Warsh stated that inflation remains too high while the U.S. economy shows signs of strengthening. Updated economic projections indicate a majority of officials anticipate at least one more rate increase before the end of the year.
Andrew Melville, head of research at Block Scholes, characterized a potential additional increase as a “more hawkish surprise than today’s 25bp hike.”
Derivatives and Spot Markets Show Divergence
While Bitcoin’s spot price remained stable, Duschang highlighted significant activity beneath the surface:
“Perpetual futures have shifted towards net selling, led by approximately $82 million in Bitcoin and $68 million in Ether over the past hour. In contrast, Bitcoin recorded around $15.5 million of net spot buying, suggesting spot demand is absorbing some of the selling pressure coming through derivatives.”
Duschang also pointed to notable exchange flows, with approximately 2,170 Bitcoin moving onto exchanges following the rate announcement, 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. The key question now is whether Bitcoin’s resilience and spot demand hold as attention shifts from today’s widely anticipated hike to the prospect of further tightening.”
Analysts Warn of Repricing Risk
Martin Lee, market insights lead at DWF Labs, warned that the Fed’s renewed “hawkish stance” of “higher for longer” rates would lead to risk-on assets “repricing this new reality.”
Related: Bitcoin awaits Fed rate decision below $76K as analysis discounts ‘dovish surprise’ odds
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