The decisions of the Federal Reserve (Fed) of the United States continue to be one of the main factors influencing the behavior of the global financial market — including cryptocurrencies. In December 2025, the Fed announced new interest rate cuts and liquidity measures that generated strong repercussions among investors. This article summarizes the latest news and explains how they affect the crypto market.
The Fed's new interest rate cut
On December 10, 2025, the Fed implemented the third consecutive interest rate cut of the year, reducing the base rate to approximately 3.50%–3.75%, the lowest level in almost three years. The decision came after intense debates within the FOMC, showing a significant division among members about the ideal pace of monetary easing.
Why does this matter?
Lower interest rates generally increase the appetite for risk, favoring assets such as stocks and cryptocurrencies. However, in this case, the reaction was less positive than many expected.
Reaction of the crypto market: decline and volatility
Despite the interest rate cut, Bitcoin and other cryptocurrencies exhibited volatile movements and, at many times, declines. BTC briefly exceeded $93,000 before retreating again to below $90,000.
Reasons for the negative reaction:
- The cut was already widely priced in.
- The Fed has indicated just one more possible cut in 2026, frustrating expectations of a more aggressive policy.
- Uncertainties in the technology sector, especially AI companies, have reduced the appetite for risk.
- The market remains extremely sensitive to any macroeconomic news.
Purchases of bonds and liquidity
In addition to the cut, the Fed announced a technical program for purchasing short-term Treasury bonds, around $40 billion, to ensure liquidity in the system. Although it is not a new 'QE', the measure influences the circulation of money and, indirectly, impacts the demand for assets like cryptocurrencies.
Banks authorized to act as cryptocurrency intermediaries
Another relevant news: US regulators have authorized traditional banks to act as intermediaries in cryptocurrency transactions. This integration increases the legitimacy of the sector but also brings discussions about systemic risks.
What to expect for the crypto market
Short term:
- Volatility is expected to remain high.
- The market needs clearer signals about inflation, employment, and the next Fed meeting.
- Rallies may occur, but quick corrections as well.
Medium and long term:
- Lower interest rates tend to benefit cryptocurrencies over time.
- The entry of banks into the sector may bring new liquidity and institutional investors.
- Even so, the market heavily depends on the global macroeconomic scenario.
Risks:
- Persistent inflation may force the Fed to pause cuts.
- Declines in the stock market, especially in AI and tech, may drag down the crypto market.
- Political and fiscal uncertainties in the US are expected to continue generating sharp movements.
Conclusion
The Fed's recent decisions show a policy in transition, trying to balance economic growth and inflation control. For the cryptocurrency market, the immediate impact was volatility and correction, but the scenario of lower interest rates tends to be positive in the medium term. Now, investors await the next signals from the central bank and economic data that may define the pace of the crypto market in 2026.
Check out my channel on YouTube: Sávio Invests
