Bitcoin Bulls Face Fed Hike Test as Crypto Legislation Vote Looms
Bitcoin's late summer rally may be put to the test this week as the Federal Reserve announces its interest rate decision, which could have a significant impact on the cryptocurrency's price. The Fed's move comes amidst a key Senate vote on crypto legislation that could potentially boost adoption.
The world's largest cryptocurrency staged a rebound past $70,000 in late August after languishing at two-year lows of around $60,000. This marked a sharp turnaround for Bitcoin, which had slumped roughly 50% from its October 2025 peak of above $126,000.
Despite traders assigning almost no chance of Bitcoin rescaling that peak, the bitcoin options market has flipped bullish for the first time in 12 months, with many traders betting Bitcoin could hit $80,000 or higher by December. The rise and fall of Bitcoin's price have been closely tied to macroeconomic factors such as inflation and interest rates.
An indication from Fed Chair Kevin Warsh that a rate hike would be a one-off rather than the start of a hiking cycle could be an upside surprise for Bitcoin bulls. However, it is unlikely that a hike of any kind would immediately be seen as positive for Bitcoin and other speculative assets.