Fed Rate Hike Seen as 'Mid-Cycle Adjustment', Limited Crypto Impact Expected

The Federal Reserve has raised its policy rate to a range of 3.75% to 4.00%, marking the first increase since July 2023.

A unanimous vote of 12-0 supported this decision, which Grayscale's research division views as 'a mid-cycle adjustment rather than a cyclical shift.'

Zach Pandl, head of research at Grayscale, pointed out that only one or two rate hikes are anticipated during 2026 and do not anticipate significant changes in investor capital allocation.

However, elevated interest rates will benefit stablecoin issuers' earnings. Circle and Tether invest a substantial portion of their stablecoin reserve assets in interest-bearing instruments, leading to increased related revenue with higher rates.