The Federal Open Market Committee (FOMC) begins its December meeting today (9), with the decision expected tomorrow (10) at 4 PM, Brasília time.
Investors and operators are closely watching to see if the central bank will continue the easing cycle or surprise by maintaining rates. As this is the last policy announcement of the year, the outcome has a significant influence on the crypto market.
With the decision approaching, market expectations are significantly pointing towards a cut, with a movement of 25 basis points being seen as the most likely outcome. CME FedWatch data indicates that operators assign a 89.4% chance for a quarter-point cut at tomorrow's meeting.
In contrast, only about 10.6% of market participants believe that the Fed will maintain rates in the current range of 3.75%-4.00%.
If the Fed opts for the cut, it will be the third consecutive this year, after adjustments in September and October. This would reduce the interest rate to the range of 3.50%–3.75%.
The September cut triggered a brief rally in the crypto market, with Bitcoin and Ethereum recording gains, while the dollar fell to its lowest level since early 2022.
However, the broader market decline neutralized the effect of the October cut. In December, volatility remains high, with significant price fluctuations.
Even so, many analysts consider that a new cut at this moment would generally be ‘positive’ for the crypto market.
“If you think this is not positive for Bitcoin and risk assets, you are not paying attention. Prepare for volatility and green candles,” said an analyst on X.
For cryptocurrencies, this standard adjustment is seen as slightly positive, as it expands liquidity and stimulates investment in risk assets, such as Bitcoin and Ethereum. However, Crypto Rover emphasized that the market has already priced in this scenario, and the announcement itself is unlikely to provoke an intense reaction.
According to the analyst, the true catalyst for movements will be Jerome Powell's press conference, not the cut itself.
“Bank of America expects Powell to signal ‘reserve management purchases’, that is, a new liquidity injection to stabilize pressure on small banks. This would help normalize the SOFR and support liquidity in the markets. If Powell adopts a moderate tone and says that inflation is being controlled, rates have not changed the trend, and the labor market is cooling, it will be a signal to expect new cuts. But, if he sounds aggressive, like in the last FOMC meeting, Bitcoin and altcoins should pull back,” he stated on X.
Meanwhile, some investors are already waiting for an even more aggressive cut of 50 basis points.
50 basis rate cut is coming….. told you.
— Grant Cardone (@GrantCardone) December 8, 2025
This would be a strong signal of policy, resulting in liquidity growing rapidly and further weakening the dollar. Although the chance of this scenario is low, the positive impact on the crypto market would likely be more intense.
Scenario without a rate cut: why maintaining the rate by the Fed could affect market sentiment in crypto.
Despite few analysts predicting this outcome, the possibility of maintaining rates by the Fed is not ruled out. The decision comes amid inconsistent economic indicators. The government shutdown has suspended the release of key data from the Bureau of Labor Statistics, leaving Fed officials with limited visibility.
“What do you do when driving in fog? You slow down,” said Jerome Powell, chairman of the Fed, in October.
The Fed itself remains divided. Powell has already declared that authorities are observing pressures from both sides of the central bank's mandate. After the most recent cut, the president lowered expectations for new adjustments in December.
“There were very divergent opinions on how to act in December. A further rate cut at the December meeting is not guaranteed, far from it,” he stated.
If this happens, the crypto market is likely to react negatively in the short term. Maintaining rates could temporarily weaken sentiment and delay any upward movement that a cut could spur.
Despite the risks, long-term trends may still favor the crypto market. Reports indicate that the Fed intends to buy 45 billion dollars in Treasury bonds per month starting in January 2026. This policy could reinforce the liquidity of the financial system and stimulate investment in risk assets.
“This would inject significant liquidity into the markets. This only indicates one direction: QE will return. But this time, they won't call it QE,” Lark Davis stated in a post on X.
Regardless of whether the Fed announces the expected cut of 25 basis points, surprises with a larger reduction, or maintains rates, its decision will likely result in significant volatility in crypto markets. The press conference and the projections presented by chairman Jerome Powell will also be relevant, as the market prioritizes indications about future monetary policy.
The article Fed Decision Could Trigger Brutal Reaction in the Crypto Market was first seen on BeInCrypto Brazil.
