Grayscale Downplays Impact of Fed's 25-BPS Hike on Crypto Markets
Grayscale Research has weighed in on the recent 25-basis-point hike by the Federal Reserve, stating that it is unlikely to drive significant changes in Bitcoin price and crypto markets. The firm views this increase as a mid-cycle adjustment rather than a cyclical shift.
The key difference between this move and previous rate hikes lies in its scale and duration. While the Fed raised the federal funds rate by 550 basis points from March 2022 to July 2023, the latest increase is smaller. Grayscale expects one or two additional rate hikes in 2026, which will remain limited.
According to Zach Pandl, head of research at Grayscale, this decision is analogous to a one-off hike made by the Greenspan Fed in March 1997. At that time, the Nasdaq bull market continued despite the increase, supporting Grayscale's view that isolated rate adjustments need not have major market effects.