Bitcoin and Ethereum prices were little changed on Tuesday as traders awaited the U.S. Federal Reserve’s highly anticipated interest-rate decision on Wednesday. Analysts say the outcome could reset risk appetite for the remainder of the year.
Matt Mina, head of digital-asset research at 21Shares, noted that markets are focused less on whether the Fed will cut rates and more on the size of any move. According to CME’s FedWatch tool, traders have largely priced in a quarter-point cut, while prediction markets such as Polymarket still see a slim chance of a deeper 50-basis-point reduction. Analysts agree that a surprise half-point cut would likely spark a fresh rally in digital assets.
Mina highlighted roughly $7.5 trillion sitting in U.S. money-market funds, whose yields would fall if monetary policy eases. “That’s a strong incentive for capital to rotate back into equities and alternatives, including digital assets,” he said. “A 25-point cut is already expected, but a 50-point move could ignite a new leg higher,” he added, while cautioning that a more hawkish stance could trigger repricing along the yield curve.
Ahead of the Federal Open Market Committee meeting, bitcoin traded in a narrow range between $115,000 and $116,000, while ether moved sideways, reflecting a broader “wait-and-see” mood in crypto markets, according to data from The Block.
Timothy Messer, head of research at BRN, described the rally as “fragile” before the Fed meeting, pointing to tight leverage conditions and lighter hedging strategies that could set the stage for sharp moves once the decision is announced.
Despite the caution, spot exchange-traded funds (ETFs) for both bitcoin and ether have seen notable inflows in recent days. The Block reports that U.S. spot bitcoin ETFs recorded six straight sessions of net inflows totaling about $260 million as of September 15, while ether products drew roughly $360 million over five consecutive sessions.
Historically, September has been one of the toughest months for bitcoin, ether, and other digital assets. Yet the final quarter of the year often brings renewed strength to risk assets. Options platform Derive.xyz characterized September’s volatility as “a pause, not the end of the rally,” suggesting traders may be bracing for a bullish close to 2025.
