As the meeting of the Federal Open Market Committee (FOMC) scheduled for September 17 approaches, expectations are rising strongly regarding the Federal Reserve's direction towards cutting interest rates, which many analysts see as a golden opportunity that could revive upward momentum in the cryptocurrency market, led by Bitcoin.

Economic circles indicate a notable alignment between these expectations and pressures from U.S. President Donald Trump, who has long called for a more flexible monetary policy in recent months, including sharp interest rate cuts.

And although the Fed's decision on July 30 to keep interest rates unchanged disappointed some traders, it provided a relatively stable ground for risk assets like cryptocurrencies, which have shown relatively resilient performance amid calm market fluctuations.

🔎 Recent statistics from the CME FedWatch Tool indicate that markets are pricing a 93.2% probability of a 25 basis point interest rate cut at the next meeting, while the chances of a hold do not exceed 7.8%, with a near-total absence of the possibility of an increase.

And although the current interest rate range (between 4.25% and 4.5%) is not the highest historically, it represents a psychological and investment barrier to capital inflow into high-risk markets like cryptocurrencies, where many prefer to move towards safer assets in such an environment.

Past experiences indicate that strong cut decisions often serve as a spark for widespread upward waves in the crypto market. For example, during the 2020 pandemic, cutting interest rates from 1.58% to 0.05% triggered one of the strongest upward waves in Bitcoin's history.

💡 An interest rate cut boosts the market in two ways:

Liquidity is easily accessible, which raises demand and drives prices up.

Increases market activity and attracts new investors, expanding the participation base.

But the critical factor this time will not be the 'cut decision' itself, but its magnitude. A modest cut of 25 basis points may be seen as a cautious attempt by the Fed to test market reaction, resulting in limited gains. A strong cut of 50 basis points or more, alongside potential fiscal stimulus related to the upcoming U.S. midterm elections, could push Bitcoin towards breaking new record levels and possibly doubling the market value of cryptocurrencies.

📉 However, attention should be paid to a common scenario in markets known as 'buy the rumor and sell the news,' where prices may have already absorbed a significant portion of the expectations, paving the way for potential corrections once the decision is officially announced.

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🔁 Summary:

Expectations of an interest rate cut favor cryptocurrencies, but the impact depends on the strength of the actual decision.

Limited cut = slight support.

Sharp cut = strong upward potential and possibly a leap towards historical peaks.

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