Master rate: Fed finally gives up and markets are agitated

What was to happen happened. After weeks of repeated pressure from the President himself, the Fed finally fell in key rates. The decision, expected but scrutinized closely, has the effect of a pavement in the financial pond. Investors now observe the repercussions of this drop in the markets, and especially on the crypto ecosystem, which lives at the rate of world liquidity flows.

The 25 -point Fed cut: Trump Jubilee, Powell delay

Following its meeting of this September 17, the Fed lowered its key rate of 25 base points, establishing a new range between 4 % and 4.25 %. It's the first cut Since December 2024. The decision, voted by 11 members against 1, has reflected the rise in risks on employment, even if inflation is still “somewhat high”.

In Its official press releasethe Fed recognized that: ” The job gains have slowed down and the unemployment rate has increased slightly but remains low. Inflation has progressed and remains somewhat high ».

But on the political side, the atmosphere is more tense. Donald Trump, on Truth Social, has castigated the hesitation of Jerome Powell ::

Too late ! We must reduce interest rates, now, and much more than he had imagined. The real estate market will explode !!!

A standoff that once again illustrates the blurred border between monetary independence and presidential pressure.

Immediate result: the dollar has weakened, Bitcoin oscillated around $ 116,000 (-0.6 %) and Ether was maintained at 4,491 dollars.

When liquidity relaunches the game of risky assets

The lower rates make traditional investments less attractive. Investors then turn to risky assets such as crypto. For Thomas Perfumo, economist at Kraken, the biggest is to come:

While the rate of Fed Funds is 100 basic points below its peak of 2024 (525–550 basic points), the real story lies in the next wave of rate cutting.

The Fed provides two other drops by the end of the year, enough to give a smile to the Crypto markets. Matt Hougan, director of investments at Bitwise, compares the current wait for a pre-match of the Super Bowl, where everything seems ready for a spectacular end-of-year rally. He stresses that the combination of rate reductions, from influx to financial products related to crypto, concerns around the dollar and the momentum of tokenization prepares the field for an explosive scenario.

For stablecoins, the drop in rates is not a brake. Chris Perkins (Coinfund) insists: the demand for yield on Stablecoins increases when the rates drop, because investors are still looking for a dollar front door in the DEFI.

The next 100 points: the real delay bomb for the crypto

The markets know that it is not the drop in the day that changes everything, but the following. Perfumo insisted on the effect of convexity of the rates: each additional reduction has an exponential impact on the prices of assets. Clearly, the next 100 points could completely redraw the crypto landscape.

Risks exist. A too fast drop could weaken the dollar and restart inflation. Conversely, too slow a rhythm could suffocate the recovery. But crypto is positioned as a credible alternative, whether for Bitcoin, Ether or the Stablecoins.

Some quantified benchmarks:

• $ 116,000: Bitcoin price at the time of the announcement, slightly 0.6 % decrease;
• $ 4,491: Ethereum courses, up 0.26 % over 24 hours;
• 35 %: share of USDT holders who use it as a savings vehicle;
• 63 %: proportion of crypto transactions passing through the USDT;
• 2: Number of additional rate drops provided by the Fed before the end of 2025.

This dynamic does not go unnoticed: the Fed has planned a conference next month devoted to stablecoins and tokenization. A sign that the USA now incorporates crypto into the very heart of their monetary reflection.

The light seems to point on the horizon, at least if we believe the vision of Trump. For him, a drop in rates is synonymous with growth, regardless of risks. For its part, the Fed has already shown a certain flexibility, recently reducing its control over the banks active in the crypto. A sign that, despite the tensions, the rapprochement between traditional finance and digital active ingredients continues.