Federal Reserve Maintains Cautious Approach as Rate Uncertainty Lingers

The CME’s “FedWatch Tool” indicated an 87.3% chance of a 25 basis point rate cut by the Fed in September 2025, with unchanged rates at 12.7%.

Market participants are adjusting to potential interest rate changes, impacting major cryptocurrencies like ETH, BTC, and BNB, as they assess the Federal Reserve’s upcoming decisions.

Fed’s 87.3% Rate Cut Probability Sparks Crypto Fluctuations

The Federal Reserve’s interest rate decisions have taken center stage, with Jerome Powell’s remarks at the Jackson Hole symposium emphasizing the Fed’s dual mandate and making only minor policy framework clarifications. Richard Clarida, former Fed Vice Chair, noted the Fed’s preparation for a cautious rate cut, highlighting the cautious climate among central bank observers. The probability of a 25 basis point rate cut now stands at 87.3% according to the FedWatch tool, indicating a strong market expectation for a shift in monetary policy.

The potential rate change has already sparked significant market responses. ETH surged beyond its all-time high amid these deliberations, although it later narrowed its gains. In parallel, BTC experienced fluctuations, momentarily dropping before clawing back above key support levels. These market moves have been accompanied by substantial staking and whale activity, reflecting an assertive repositioning strategy amid rate cut speculations.

High-profile figures in the crypto industry have acknowledged these developments. Mike Novogratz from Galaxy Digital highlighted the robust performance of Hyperliquid’s platform within the market ecosystem: “Impressive work…we hold a long position in the HYPE token.” The narrative of institutional engagement persists, as evidenced by large BNB investments that pushed it to a new ATH. Meanwhile, the crypto community and other market participants remain vigilant, preparing for possible changes in liquidity and valuation dynamics.

Impact on ETH and BTC Amid Rate Speculations

Did you know? In March 2023, similar positioning and whale flows intensified volatility during central bank decision cycles, influencing both staking assets and significant cryptocurrencies.

Ethereum (ETH) stands prominently in discussions, with its current price at $4,660.27 and a market capitalization of $562.53 billion. It commands 14.41% of the market dominance. ETH witnessed a 2.20% price decline in the past 24 hours, yet it reflects a substantial 9.02% and 24.46% gain over the last 7 and 30 days, respectively. This data underscores ETH’s pivotal role amid ongoing fiscal deliberations. Source: CoinMarketCap.

Reflecting on the scenario, the Coincu research team foresees that regulatory vigilance and strategic financial positioning will shape future market landscapes. Historically, monetary policy adjustments have influenced crypto asset valuations and trading volumes, tightening the focus on investor behavior and institutional participation, particularly during critical rate announcement periods. Moving forward, examination of market trends and strategic adaptation will drive the momentum of crypto ecosystems.