- Federal Reserve cuts interest rates by 25 basis points; crypto liquidity remains low.
- Crypto markets show limited activity due to year-end factors.
- Bitcoin faces resistance at $100,000, while Ethereum is at $3,200.
On December 11th, the Federal Reserve announced a 25 basis point interest rate cut and resumed short-term Treasury bond purchases, signaling a dovish shift beneficial for the financial markets.
This monetary policy adjustment influences crypto market sentiment, marked by low liquidity and cautious trading strategies, with potential for volatility due to unexpected positive developments.
Fed’s 25 Basis Points Cut: Impact on Crypto Liquidity
The Federal Reserve’s decision on December 10, 2025, to reduce interest rates by 25 basis points follows an earlier pattern of easing monetary policy. This action aims to maintain economic stability amid signs of slower job growth and increased inflationary pressure.
Cryptocurrency markets may not see immediate benefits due to current thin liquidity. Although the Fed’s easing policy supports risk assets, the crypto market faces low sentiment and limited movement because of these conditions.
Jerome H. Powell, Chair, Federal Reserve, “decided to lower the target range for the federal funds rate by 1/4 percentage point to 3-1/2 to 3‑3/4 percent.”
Options data analyst Adam @Greeks.live indicated that traders are adapting, with covered call strategies becoming more prevalent. Bitcoin and Ethereum face resistance at key levels as traders hedge their bets with put options, reflecting caution rather than optimism.
Crypto Market Sentiment Amid Economic Signals and Price Trends
Did you know? In past cycles, market sentiment following modest rate cuts often resulted in subdued volatility, with Bitcoin and Ethereum aligning closely with macroeconomic indicators before explosive growth in bull phases.
According to CoinMarketCap, Bitcoin (BTC) currently trades at $90,237.36 with a market cap of 1.80 trillion USD. Despite recent price changes of -2.70% over the last 24 hours and -21.63% over 90 days, Bitcoin maintains dominance at 58.59%. The 24-hour trading volume stands at 70.56 billion USD.
The Coincu research team suggests that while regulatory easing may eventually benefit cryptocurrencies, the current conservative market sentiment indicates limited short-term upside. Observations point to a careful watch on economic data influencing Fed policy.
| DISCLAIMER: The information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing. |
Source: https://coincu.com/analysis/fed-rate-cut-crypto-impact-14/
