Author: @aljif7
Platform: Hive
Date: Friday 6 June, 2025
Category: Finance-CryptoNews
BTC. again in the eyes of Analysts
According to Cointelegraph News, a surprising early move by the U.S. Federal Reserve to cut interest rates could send Bitcoin (BTC) soaring back toward its recent all-time high of $112,000, mentioned a market analyst.
Carlo Pruscino, a market analyst at CMC Markets, told Cointelegraph that if the Fed moves faster than anticipated on rate cuts, it could trigger a significant rally in crypto markets.
“When these two further rate cuts come, if they’re coming a lot sooner than expected, that will then impact heavily on the future price moves of crypto, on Bitcoin and some other cryptos as well,” Pruscino said.
He pointed out that $112,000 has become a key psychological level for traders, especially after Bitcoin briefly touched this level earlier this month before pulling back to around $103,124 at the time of writing this post.
đź’ˇA question coming to mind : Why Do Interest Rate Cuts Impact Bitcoin?
Interest rate cuts by the Federal Reserve can have a ripple effect across financial markets, including cryptocurrencies like Bitcoin. Here’s why:
1. Lower Rates = More Liquidity
When the Fed cuts interest rates, borrowing becomes cheaper, increasing liquidity in the financial system. This often leads investors to seek higher returns in riskier assets — including stocks, gold, and crypto.
2. Weaker Dollar
Rate cuts can weaken the U.S. dollar, making dollar-denominated assets like Bitcoin more attractive to foreign investors. A weaker dollar also pushes investors into alternative stores of value.
3. Risk-On Sentiment
Lower interest rates typically signal a more accommodative monetary policy, boosting investor confidence and encouraging risk-taking behavior. In such an environment, speculative assets like Bitcoin tend to perform well.
4. Inflation Hedge Narrative
Bitcoin is increasingly seen as a hedge against inflation. When real yields drop due to lower interest rates, the appeal of non-yielding but scarce assets like BTC rises.
⚖️ Fed’s Dilemma: Tariffs and Data
While many expect the Fed to hold rates steady at its June 18 meeting, Pruscino noted that the central bank already has “enough data” to make a decision — but there's still one big unknown: U.S. trade policy, particularly tariffs from President Donald Trump.
Trump recently doubled tariffs on steel and aluminum imports to 50%, reigniting fears of inflationary pressures and complicating the Fed’s path to cutting rates.
Its tariffs policy received a unexpected reverse. On May 28, a federal court temporarily blocked Trump's tariff plan, but an appeals court later allowed them to continue. Then, we still see how unclair could be the called Trade War.
đź”® Final Thoughts
Bitcoin’s recent pullback from its all-time high doesn’t necessarily spell trouble. If the Fed surprises with earlier-than-expected rate cuts, fueled by improving economic or geopolitical signals, BTC could once again test the $112,000 psychological barrier.
As always, traders should keep a close eye on macroeconomic developments — especially from the Fed and U.S. fiscal policy — which are increasingly shaping the narrative for digital assets.
đź“Ś Disclaimer:
This article is for informational purposes only and does not constitute investment advice. Cryptocurrency markets are highly volatile, and every investment carries risk. Always do your own research before making any financial decisions.
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