So, the Federal Reserve went ahead and trimmed rates, and Bitcoin‘s reaction? A masterclass in poker faces, says Coinshares’ Head of Research James Butterfill. Apparently, traders are like, “Nice try, Fed. We need more than a polite tap on the brakes before we start fist-pumping.” 🤷♀️
Butterfill: Rate Cut Buzz is Dead; Bitcoin is Practicing Its Patience
Bitcoin (BTC) has basically been bobbing up and down in a kiddie pool for three months, while volatility got squeezed down to about 26%. That’s the financial equivalent of a lukewarm flat white-definitely not the fireworks show you’d expect after an easing policy. Butterfill’s report basically translates fancy futures market talk as: “Maybe three cuts this year, maybe not-try convincing me first.”
The Fed nipped 25 basis points off their rates to a 4.0%-4.25% range. Meanwhile, new guy Stephen Miran was the lone wolf craving a half-point cut-aiming for a bit more drama. The “dot plot” crowd now expects another 50 bps sliced in 2024, with baby 25-bps slashes penciled in for 2026 and 2027-because who doesn’t like a slow drip?
How divided is the Fed, you ask? Nine Fed folks are dreaming of two more chops next year, two are hoping for just one, six are playing it cool with no more cuts, and one bold soul even suggests rates might actually rise by year-end. That’s Cleveland Fed President Beth Hammack throwing some shade with a “silent dissent.” One outlier’s even fantasizing about a 125 bps cut in 2025-someone’s been hitting the monetary policy Kool-Aid hard.
stronger growth in 2025, lower unemployment, inflation still hanging around like that one cousin at your party who just won’t leave, plus ominous employment risks lurking in the corner. #PlotTwist
In Butterfill’s world, this all spells a Fed that’s trying to be nice-a more dovish vibe that eases policy even though inflation isn’t taking the hint. This indecision actually makes bitcoin look sexier as a hedge against what he calls “monetary debasement.” Fancy talk for “protect your wallet before inflation crashes the party.”
But here’s the kicker: the market is either very skeptical or just really good at playing hard to get. Until the Fed stops whispering sweet nothings and starts belting out a clear easing anthem, bitcoin is happy to sit back, keep volatility compressed, and wait for the Fed to actually sing instead of hum.
“We see the Fed acting all dovish like it’s trying to be your caring but confusing grandma,” Butterfill writes. “Bitcoin, meanwhile, is eyeing this as its chance to be the ‘I told you so’ hedge-but investors want a solid proof of concept, not a wink and a nod.”
CME’s FedWatch tool is basically yelling “game over,” giving a better than 90% chance the Fed chops another 25 basis points. Polymarket fans are slightly less convinced at 86%, and Kalshi’s betting crowd’s nodding along at 85%-basically a slam dunk for the central-bank crowd, if they ever decided to dunk.
Bitcoin remains statuesque, and the odds that this will change immediately? Slim to none. With the next cut all but guaranteed, traders are cozying up with their lattes, waiting for Fed Chair Powell to drop the mic. Until then, bitcoin is playing the strong, silent type-because sometimes mysterious is just better. 🎤☕
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2025-09-21 02:38