Federal Reserve Governor Christopher Waller has hinted that the U.S. central bank may lower interest rates as early as next month. Speaking ahead of the Federal Reserve’s next policy meeting on July 29–30, Waller said, “We could do this as early as July. I think we’ve got room to bring it down, and then we can kind of see what happens with inflation.”
This news has sparked excitement in the crypto world. Bitcoin investors are closely watching the Fed’s next move, hoping it will unlock a new wave of market activity. The Fed had recently held rates steady at 4.25% to 4.50%, but hinted at two possible cuts before the end of 2025.
Lower interest rates often push investors toward higher-risk assets like crypto. That’s because borrowing becomes cheaper, and the potential returns in traditional savings accounts drop. Dan Raju, CEO of Tradier, explained, “High interest rates scare investors away from riskier investments like crypto, and the lowering of rates will be seen as a positive by the crypto investor community.”
In fact, past trends show how crypto reacts to Fed decisions. In 2022, when rates jumped from near zero to over 4%, Bitcoin and other digital coins dropped sharply. But when the Fed paused hikes in 2023 and 2024, crypto prices bounced back.
Adding to the momentum. Bitcoin ETFs have been doing really well lately. With Investors pouring over $9 billion into these funds, led by BlackRock’s iShares Bitcoin Trust (IBIT). On May 22 alone, $432 million entered Bitcoin ETFs in just one day, signaling growing investor appetite.
With all eyes on the July meeting. If rates go down, Bitcoin might shoot up and even try to beat its record price of $111,970. But if the Fed doesn’t cut and prices stay high, the crypto market might slow down or even dip.
What the Fed decides next month could change the crypto game big time. Investors are paying close attention, and the July meeting is just around the corner.
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