Fed Rate Cut Madness: Bitcoin’s Rollercoaster Ride and Altcoin Antics Ahead!

by

The Federal Reserve’s grand performance on September 17 promises to be the Super Bowl, Times Square ball drop, and family reunion of all risk asset events this year. Crypto traders? They’re strapped in for the chaos, popcorn in hand. 🍿

Everyone’s whispering about a rate cut like it’s some sort of magic potion-but whether the Fed goes half a teaspoon (25 bps), a full tablespoon (50 bps), or opts to be that awkward friend who just shows up and says nothing (no change), things could get messy for Bitcoin and the merry band of altcoins.

The 25 Basis Point Baseline

Most financial soothsayers agree that a humble quarter-point cut is the “vanilla” option. Charlie Bilello, who I imagine wearing a wizard hat while staring at charts, says: “Yep, 25 bps coming soon!”

Meanwhile, bond market obsessives like Shazi are so sure it’s happening that they might have already thrown a party. Yields are pricing in three more cuts by year-end, which is like expecting your favorite TV show to get three more seasons-even if it’s been cancelled.

“The 10-Year Note Yield officially drops below 4.00% for the first time since April 4. Markets are now fully pricing in three 25 bps interest rate cuts by year-end,” announced The Kobeissi Letter, presumably with the excitement of a kid who just found out the ice cream truck is back in town.

But hold your confetti, folks. This certainty might be a double-edged sword-kind of like a knife… or a cryptocurrency named after an edible fruit. Analysts warn of a “sell-the-news” party pooper.

“There’s probably a 99% chance a rate cut is announced on Wednesday. No one will be surprised by that. This is why it’s often a sell-the-news event. Thursday might be green, Friday chaos, but in the end, it all finishes with a smile,” quipped the IncomeSharks crew, who apparently moonlight as fortune tellers.

Bitcoin, ever the drama queen, has shown us before that a rate cut isn’t a golden ticket.

“Last time the Fed cut rates was December 18, 2024. Bitcoin was cruising at $106,000 and then decided to nosedive 30% faster than my self-esteem after a breakup,” noted analyst Quinten.

Currently, Bitcoin is back above $115,000, but traders are wary-like someone who sees a “Free Puppies” sign and suspects a trap.

Then there’s Ted Pillows, probably not an actual pillow but a financial analyst anyway, painting two gloomy pictures: either Bitcoin drops to $104,000 then rebounds, or it dives to $92,000 to fill a mysterious “CME gap.” I’m guessing this gap isn’t a Starbucks-sized hole in the market floor.

The Fed will cut rates in just 2 days.

JP Morgan and other bigshots expect a market dump before a rebound.

Scenario 1: $BTC will dump toward $104,000 before a heroic reversal.

Scenario 2: Bitcoin dives to $92,000 (CME gap alert!) before staging a comeback and…

– Ted (@TedPillows) September 15, 2025

The 50 Basis Point Surprise

A bigger, bolder cut is still on the table, though it feels like betting on a unicorn showing up with pizza delivery. Gurgavin mentions Standard Chartered is hoping for a 50-bps move, but Kalshi’s odds sit snug at just 9%. That’s like me trying to stick to a diet for more than a day.

STANDARD CHARTERED THINKS THE FED WILL SLASH RATES BY 50 BPS THIS WEEK BECAUSE JOBS SUCK.

KALSHI SAYS ONLY A 9% CHANCE THAT HAPPENS. SO MUCH FOR CONSENSUS.

– GURGAVIN (@gurgavin) September 15, 2025

Should this 50-bp moonshot happen, it could unleash $2.5 trillion in liquidity, potentially sending altcoins flying higher than my hopes of winning the lottery.

Zero Hedge, always ready with a snarky comment, reminded us that JPMorgan gives this scenario a 7.5% chance, and in that world, equities could jump or plunge by 1.5%. Translation: toss a coin, or better yet, throw your crypto portfolio in the air and hope it lands on heads.

JPM FOMC odds:

1% chance of a rate hike-implying the Fed is basically a puppet, dancing to the tune of whoever’s in the White House.

7.5% chance of 50bps cut. Market could tank or soar by 1.5%. Choose your adventure.

– zerohedge (@zerohedge) September 16, 2025

This wild card could shatter the “sell-the-news” curse and convince the Fed is more generous than your least favorite uncle at Christmas.

The Zero-Cut Shock

No one’s really banking on the Fed just chilling, but the possibility lurks like a bad smell in an elevator. Zero Hedge reminds us that the market still factors in a tiny chance of a hike-because why not keep life interesting?

If Powell decides to play tough and holds the line, the crypto world might turn south faster than you can say “digital disaster.” As Hunts puts it, the market’s already “on shaky ground,” tangled up in politics and tariffs like a badly knit sweater.

“Crypto markets are back on shaky ground. Bitcoin is backing off from recent highs while traders bite their nails over the Fed’s next move. A 25-bps cut seems likely, but President Trump’s demands for deeper cuts (to soothe tariff wounds and a cooling job market) add extra spice,” Hunt explains.

It’s a tug-of-war that’s uglier than a family Thanksgiving at your in-laws, and Bitcoin’s feeling every tug.

“…The big question: Will the Fed play it safe or go for the jugular?” Hunts wonders.

A no-cut would probably send a chill through risk assets, with Bitcoin catching the cold in full force.

Beyond the Decision, Tone Matters

At the end of the day, it’s not just whether Uncle Powell cuts the rate like slicing a pie, but how he talks about it-because tone is everything. Crypto fans will dissect his every word like codebreakers trying to find hints of future kindness.

“It won’t be a sell-the-news event if Powell speaks all cuddly and dovish, which, let’s be honest, he probably will,” says Kale Abe, the eternal optimist.

Traders will be hanging on every syllable, with September’s penchant for seasonal equity sell-offs adding some extra drama. Crypto’s been riding the wave of hope for easy money for months now. Whether September 17 becomes the next great launch or a faceplant depends on which version of the Fed shows up to the party. 🚀 or 💥, only time will tell.

Read More

2025-09-16 09:14