Fed Rate Cuts & Crypto: The Historical Relationship

CryptoRebateHub Editorial Team

How interest rate cycles have historically moved BTC and ETH prices

As a risk asset, crypto is highly correlated with macro monetary policy. Fed rate decisions affect global liquidity, which flows into crypto markets.

Rate Cut Cycles vs Crypto Prices

2019-2020 Rate Cuts: The Fed cut three times in 2019, BTC rose from $3,500 to

0,000 pre-COVID. The March 2020 emergency cut + unlimited QE directly fueled the 2021 bull market.

2022-2023 Rate Hike Cycle: The most aggressive hiking in 40 years (0→5.25%). BTC fell from $69K to

5.5K; ETH from $4,891 to $879. Crypto was among the hardest-hit asset classes.

2024 Rate Cuts Begin: When the Fed began cutting in Sep 2024, BTC hit all-time highs driven by rate cut expectations + spot ETF approval.

Key Logic: Low rates → falling risk-free yields → capital flows into risk assets → bullish for crypto. High rates → rising risk-free yields → capital flows to bonds/money markets → bearish for crypto.

For reference only. Not financial advice.