Grayscale: Fed Interest Rate Hikes Won't Bother Bitcoin Price

The recent Federal Reserve interest rate hike had little effect on Bitcoin's price, according to Grayscale's crypto research team. The hike, which was the first since 2023, sent the price of Bitcoin 'briefly all over the place' but it quickly settled and is now only 1% higher over a 24-hour period.

Zach Pandl, head of research at Grayscale, believes that the interest rate hike was a 'mid-cycle adjustment, not a cyclical change.' He doubts that the one or two rate hikes expected for 2026 will have any significant impact on capital allocation. Pandl notes that low interest rates typically mean more liquidity for investors to take risks and buy assets like Bitcoin.

The opposite has been true in some cases: when the Federal Reserve increased borrowing costs, the price of Bitcoin has slid. However, Pandl argues that this time is different and compares it to 1997, when the Nasdaq continued to rise despite a one-off interest rate hike by the Federal Reserve.