Fed Holds Steady, Powell is Hawkish! Is There Still Hope for Bitcoin? Analysis: Rate Cuts Could Push it to $150,000

After Federal Reserve Chairman Jerome Powell's hawkish comments downplayed market expectations for a September rate cut, the cryptocurrency market experienced severe turbulence, with the futures market witnessing over $400 million in liquidations.

The Federal Reserve's latest decision to hold steady and maintain interest rates was in line with market expectations, but Powell bluntly stated that a rate cut in September is too early and insisted on waiting for the impact of tariff policies on inflation to become clearer before considering a rate cut.

In addition, two officials at the meeting explicitly expressed support for rate cuts, indicating a divergence of opinions within, leaving the market more confused about the future direction of interest rates.

During Powell's speech, Bitcoin briefly plummeted below $117,000, and Ethereum also fell back to $3,700, with $200 million liquidated across the network in just one hour.

According to data from Coinglass, as of the time of writing, the cryptocurrency derivatives market has suffered approximately $432 million in liquidations over the past 24 hours, of which about $332 million came from long positions.

21Shares analyst Matt Mena stated that the market is gradually realizing that the Federal Reserve's pace of interest rate cuts may be lagging behind. He pointed out:

Last week's Personal Consumption Expenditures Price Index (PCE) showed a second consecutive decline, and consumer spending also showed signs of weakness. Coupled with rising unemployment rates and real interest rates still at high levels, if the Federal Reserve remains stubborn on interest rates, it could lead to excessive policy tightening and trigger a broader economic slowdown.

Matt Mena added that the current market atmosphere is quite similar to the fourth quarter of 2023—gradually cooling inflation, rising political uncertainty, while the Federal Reserve is constrained by lagging economic indicators, resulting in slow policy adjustments.

He emphasized that the situation is now set, and once the Federal Reserve starts the rate cut cycle, Bitcoin is expected to rise to $150,000 by the end of the year.