LATEST: The bigger surprise from the Fed wasn't the rate hike itself but the removal of expected easing through 2027 in its dot plot, delaying the liquidity conditions Bitcoin typically benefits from, per CoinShares.

What happened

The Federal Reserve raised its key interest rate and, more notably, removed expected rate cuts through 2027 from its dot plot, which is a chart of policymakers' rate projections. This delays the looser money conditions that Bitcoin typically benefits from, according to CoinShares.

Confirmed

Global impact / market context

For Bitcoin, delayed rate cuts mean higher borrowing costs and less cash available in the financial system for longer. This could reduce investor appetite for risky assets like Bitcoin, because the opportunity cost of holding it increases when interest rates stay high.

Analyst inference

Bitcoin has historically risen when central banks inject cash or cut rates, because that increases risk-taking. With the Fed now signaling no easing for years, the usual boost for Bitcoin is postponed, possibly keeping its price under pressure compared to expectations.

Analyst inference

What to watch

1. The Federal Reserve's dot plot now shows no rate cuts through 2027, as confirmed in the article. This means interest rates are expected to stay higher for several years, which directly affects how investors value Bitcoin. Confirmed
2. Watch for future Fed statements or economic data that might change the dot plot. If inflation falls or unemployment rises, policymakers could shift back to cutting rates, which would likely improve conditions for Bitcoin. Proposed
3. Investors should monitor the actual cash available in financial markets, such as money supply growth or borrowing activity. If cash tightens further despite the Fed's path, Bitcoin could face even more headwinds than currently expected. Analyst inference

Affected assets

• BTC — Bitcoin

Evidence

• x.com