Fed Policy Decision Looms as Key Event for Crypto Market
The Federal Open Market Committee (FOMC) is set to convene on Wednesday, June 17, for a policy decision that marks the first under new Chair Kevin Warsh. Bitget CEO Gracy Chen has identified this meeting as a pivotal macroeconomic event for the cryptocurrency sector.
Chen described the current economic landscape as exceptionally challenging, characterized by persistent inflation and a White House keen on increasing liquidity, all while the Federal Reserve appears more internally divided than in recent years.
Market observers, based on online commentary, do not anticipate any changes to interest rates, with a hold being widely priced in. Some analysts, such as HaxKai, suggest that focusing solely on the rate decision itself is a misdirection, stating that “watching the rate decision itself is watching the wrong thing.”
Instead, the focus is expected to be on the FOMC’s “dot plot,” which signals future rate expectations, and, crucially, on how Warsh navigates his inaugural press conference as chair. Chen believes that cryptocurrencies have evolved into a truly cross-asset class, a dynamic that older analytical frameworks fail to adequately capture.
“The old idea that crypto only trades on crypto-native narratives is outdated,” Chen posted on X. “Today, BTC, US equities, gold, FX and commodities are all reacting to the same macro question: Where is liquidity going next?”
Chen anticipates that if Warsh adopts a hawkish tone, the U.S. dollar is likely to strengthen, exerting downward pressure on gold and risk assets. Conversely, a dovish stance from Warsh could potentially trigger a relief rally across equities and cryptocurrencies. However, she cautioned that the market would likely scrutinize the justification for any easing measures given the prevailing high inflation.
This perspective is supported by recent data. An analysis by Charlie Bilello on June 16 indicated that Bitcoin and gold are the only major asset classes showing losses year-to-date in 2026, with cryptocurrency down 27%, while the S&P 500 has gained 9% and small-cap stocks have risen 19%.
Previous analysis by XWIN Research on Warsh suggested a greater emphasis on balance sheet reduction over interest rate cuts. This research also posited that reducing liquidity through quantitative tightening could negatively impact risk assets, even if short-term rates remained unchanged.
In contrast, investor Ran Neuner expressed a “mega bullish” outlook heading into the meeting. His reasoning is that any indication of the Fed moving away from a rate hike path could bolster risk assets, particularly if inflation expectations decline alongside lower oil prices.
HaxKai, however, remains less optimistic. They pointed out that Bitcoin has historically declined following most FOMC meetings and noted that the recent rally from $59,000, which stalled at $67,000 earlier this week, leaves considerable room for a downturn. Consequently, they advised traders to exercise caution and avoid making immediate moves in the aftermath of the announcement.
At the time of this report, Bitcoin was trading near the $65,000 mark, representing a roughly 2% decrease from the previous day but a nearly 6% gain over the preceding seven days.
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