Fed’s Stagflation Signal Could Be $BTC Bitcoin’s Bullish Breakout Moment
The Federal Reserve’s latest policy update may have sounded cautious, but to crypto markets, it was a quiet signal: stagflation risks are back on the radar—and Bitcoin could stand to gain.
Following the Fed’s decision to hold interest rates steady, Bitcoin pushed past $96,000, rising 1.6% in 24 hours. While major altcoins like XRP, AVAX, and UNI recorded mild losses, the flagship cryptocurrency held strong, signaling renewed investor interest in decentralized stores of value.
The Fed’s acknowledgment of rising inflation and increasing unemployment—core ingredients of stagflation—marked a subtle yet critical shift in tone. Historically, this economic cocktail has troubled equities and traditional assets, but this time, digital assets like Bitcoin may tell a different story.
“The Fed is worried about stagflation,” noted Grayscale's Head of Research, Zach Pandl, in a post on X. “We think that outcome would be good for bitcoin.”
Pandl, who has long championed Bitcoin as a modern alternative to gold, argued that in periods of stagflation, scarce assets outperform. Bitcoin, though never tested in previous stagflationary cycles, is increasingly seen as a digital commodity and a hedge against macro instability.
Chair Jerome Powell attempted to reassure markets, stating the U.S. economy is still in "good shape" and the Fed is in a position to “wait and see.” Yet, the market reaction said otherwise. While Bitcoin hovered near $96,500 after briefly touching $97,500 on U.S.-China trade optimism, altcoins lagged, and the broader CoinDesk 20 Index rose just 0.3%, dampened by losses in NEAR, AAVE, and others.
Stocks also showed resilience, with the S&P 500 and Nasdaq ticking up 0.4% and 0.3%, respectively—but the real story was Bitcoin's quiet strength amid macroeconomic uncertainty.