Bitcoin experienced a volatile trading session following the Federal Reserve’s rate cut decision on Wednesday. The cryptocurrency dropped to $89,000 before climbing back above $93,000.
The Federal Reserve delivered its third consecutive interest rate cut this year. The central bank has reduced rates by a total of 0.75% over the three-month period from September to December 2025.
Bitcoin’s price movement matched a recurring pattern seen with previous Fed rate cuts. Each of the three cuts triggered short-term sell-offs despite being fundamentally bullish for crypto in the long term.
Onchain analytics firm Santiment described this behavior as a classic “buy the rumor, sell the news” pattern. The firm noted there is “typically a bounce after the dust settles.”
The US Fed made three strategic cuts over the past 3 months, resulting in a total of an 0.75% reduction to interest rates.
1⃣ September 17, 2025: Fed lowered the target range to 4.00 %–4.25 % (from 4.25 %+) at the 16–17 Sep meeting.
2⃣ October 29, 2025: Fed cut the rate to… pic.twitter.com/X6DWypvq5t
— Santiment (@santimentfeed) December 11, 2025
Bitcoin slipped below $90,000 immediately after the Fed announcement. The cryptocurrency then recovered to spike at $93,500 on Coinbase during Friday morning trading.
Resistance at the $93,500 level proved strong. Bitcoin pulled back to around $92,300 where it was trading at the time of reports.
Most altcoins did not participate in Bitcoin’s rebound. Cardano’s ADA and Avalanche’s AVAX led declines among major cryptocurrencies.
Both ADA and AVAX dropped 6-7% on the day. Ether held above $3,200 but was down 3% during the same period.
Jasper De Maere from trading firm Wintermute said the price action showed crypto’s growing separation from equities. He noted that only 18% of sessions over the past year saw Bitcoin outperform the Nasdaq on days with major economic news.
The Fed’s updated dot plot leaned slightly hawkish according to analysts. The dot plot shows where Fed policymakers expect interest rates to move in the future.
The central bank also announced $40 billion in short-term Treasury purchases. Ko described this as a “technical maneuver for financial system liquidity” rather than a large-scale stimulus program.
Markets interpreted the Treasury purchases as mildly bullish. U.S. stocks moved higher alongside Bitcoin’s rebound.
The Nasdaq closed down just 0.25% after being as much as 1.5% lower earlier in the day. The S&P 500 finished modestly in the green while the DJIA gained 1.3%.
Analytics firm Swissblock said downward pressure on Bitcoin is losing steam. The firm noted the market is stabilizing but cautioned it is not yet out of the woods.
The Bitcoin Risk Index is showing a crucial step:
The second selling wave is weaker than the first, and selling pressure is not intensifying.
Signs of stabilization… but not confirmation.
We still need Risk < 25 and structural reclaim levels before calling a bottom.… pic.twitter.com/UvoMqxVGco
— Swissblock (@swissblock__) December 11, 2025
“The second selling wave is weaker than the first, and selling pressure is not intensifying,” Swissblock said. The firm added there are signs of stabilization but no confirmation yet.
Lower interest rates typically increase risk appetite among investors. Cheaper borrowing costs push more capital into speculative assets like cryptocurrencies.
Fidelity Investments’ director of global macro Jurrien Timmer said Bitcoin has underperformed stock markets this year. However, he noted the cryptocurrency market appears to be maturing compared to previous cycles.
The U.S. dollar index dropped to its weakest level since mid-October. This helped precious metals rally, with silver surging 5% to a fresh all-time high of $64 per ounce.
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