In the early morning hours, global crypto market investors turned their attention to Washington, where the Federal Reserve is set to announce its final interest rate decision of the year on December 10 local time (December 11, early morning Beijing time).
The market has reached an almost unanimous consensus: the Fed will cut rates for the third consecutive time, lowering the federal funds rate target range by 25 basis points. However, investors are more concerned that this could be a "hawkish rate cut"—meaning the Fed may signal a pause in easing going forward, even as it lowers rates.
As of December 10, the Bitcoin price was highly volatile, trading at $93,020.42, up 2.63% in the past 24 hours.
01 Market Update: Bitcoin Returns to Highs, Volatility Intensifies Ahead of Rate Cut
On December 10, Bitcoin experienced classic "pre-decision turbulence." Market data showed its price briefly dipped below $92,000 before rebounding sharply and breaking through the $93,000 mark.
The overall sentiment in the crypto market is mixed. On one hand, the probability of a rate cut is now 87%, up from less than 67% a month ago. On the other, growing anxiety has triggered widespread liquidations. As of press time, more than 110,000 traders have been liquidated across the crypto market, wiping out roughly 3 billion yuan.
This volatility reflects deep market divisions. According to prediction market Polymarket, traders now assign a 40% chance that "Bitcoin will hit $100,000 again this year."
At the same time, there’s a 24% probability that Bitcoin could fall below $80,000. The market continues to swing between hope and caution.
02 Policy Dilemma: What Exactly Is a "Hawkish Rate Cut" from the Fed?
The market’s wariness about a "hawkish rate cut" stems from lessons learned in October. Back then, the Fed lowered rates by 25 basis points and ended quantitative tightening—a dovish combination. Yet, Chairman Powell poured cold water on expectations at the press conference.
He repeatedly stressed that another rate cut in December was "far from a done deal," and unusually disclosed internal committee disagreements. This led to a rise in both the dollar and Treasury yields, causing risk assets to quickly give back gains.
Today, the Fed faces an even more complex situation. The committee is deeply divided: some members worry about a weakening job market, while others remain focused on core inflation, which is still above the 2% target.
Complicating matters, a government shutdown delayed the release of key November jobs and inflation data, forcing the Fed to make decisions with incomplete information.
"This puts the Fed in a tightrope situation," commented Diane Swonk, Chief Economist at KPMG.
03 Scenario Analysis: Three Possible Paths for the Crypto Market
This rate decision could steer the market down three very different paths, each with distinct implications for Bitcoin and other crypto assets.
Baseline Scenario (Most Likely)
Rates are cut by 25 basis points as expected, but the dot plot remains conservative about further cuts into 2026, and Powell continues to stress "no preset path." The market may rally in the short term, with Bitcoin attempting to retest previous highs, but sustained momentum is uncertain. High-level volatility is likely.
Dovish Surprise (Less Likely)
In addition to a rate cut, the dot plot is revised downward, signaling room for further cuts into 2026. This would be a double boost—"rates + liquidity." If Bitcoin can hold above $90,000, it could make another run at the psychological $100,000 level.
Hawkish Surprise (Less Likely but High Impact)
The Fed holds rates steady or sharply reduces the projected scope for future cuts, clearly signaling "higher rates for longer." This would strengthen the dollar and put pressure on all non-cash-flow assets. With ETF inflows already slowing, Bitcoin could technically seek new support levels.
04 Institutional Shift: Standard Chartered Lowers Forecast, Market Drivers Change
On the eve of the rate decision, institutional expectations for Bitcoin have quietly shifted.
Standard Chartered recently slashed its price forecast for Bitcoin, halving its year-end 2025 target from $200,000 to $100,000. While its long-term target of $500,000 remains unchanged, the timeline has been pushed back from 2028 to 2030.
Analyst Geoffrey Kendrick explained that the downgrade is driven by changes in market demand. The earlier phase of aggressive corporate treasury accumulation (such as MicroStrategy) has "basically ended," and future gains will depend almost entirely on ETF inflows.
However, data shows ETF demand is cooling. This quarter’s ETF inflows total about 50,000 BTC—the lowest since US spot Bitcoin ETFs launched and far below the peak quarterly inflow of 450,000 BTC at the end of 2024.
05 Long-Term Concerns: Cycle Models Break Down, Market Structure Evolves
A deeper shift is taking place in market perception. Standard Chartered’s report bluntly states that the traditional "halving cycle" playbook may no longer apply—"this time really is different."
Analysts believe the "crypto winter" may be over for good. Prediction markets confirm this, with users assigning just a 6% chance of a new crypto winter before the end of February 2026.
This structural change means Bitcoin’s correlation with traditional macro factors is strengthening. As more institutional investors enter, Bitcoin increasingly tracks the same drivers as equities and other risk assets—especially monetary policy.
The growing correlation between Bitcoin and US equities in 2025 has made this clear. From the surge following Trump’s election victory at the start of the year to the sharp drop after tariffs were announced in April, both markets have moved in lockstep.
Potential Market Directions After the Fed Decision
| Scenario | Key Features | Impact on USD/Treasuries | Short-Term Impact on Bitcoin | Estimated Probability |
|---|---|---|---|---|
| Hawkish Rate Cut | 25bp cut, conservative dot plot, Powell signals pause | Dollar strengthens, yields steady or rise | Rallies then retreats, high-level volatility | Most likely |
| Dovish Surprise | Cut plus dovish dot plot, signals continued easing into 2026 | Dollar weakens, yields fall | Challenges $100,000 level | Less likely |
| Hawkish Surprise | No cut or sharply reduced future cut projections | Dollar surges, yields spike | Seeks new support levels | Less likely but high impact |
Outlook
The hour following the announcement will be a battleground for emotion and algorithmic trading, with dramatic swings on the charts. But the true trend usually emerges in the 12 to 24 hours after Powell’s press conference, once investors have digested all the information.
Standard Chartered analyst Geoffrey Kendrick wrote in his report: "This time really is different."
He’s referring to the possible breakdown of the old halving cycle model. When Bitcoin and the equity indices plunge together on tariff news, and when the Fed’s rate meeting overshadows block reward halving as the market’s key event, crypto has moved from the fringes to the center of the global macro stage.
Whatever happens tonight, the crypto market has forever left behind its isolated cycle.
