According to QCP (@QCPgroup), despite Federal Reserve Chair Jerome Powell's recent wait-and-see approach, market participants are already pricing in three interest rate cuts for 2025—expected in July, September, and December. This growing disconnect between official Fed communication and market sentiment is creating increased volatility, which historically has boosted trading volumes and price swings in the cryptocurrency markets. Traders should monitor Fed policy announcements closely, as rate cuts often drive capital into risk assets like Bitcoin and Ethereum, influencing short-term crypto price action and liquidity (Source: QCPgroup on Twitter, May 8, 2025).

According to @KobeissiLetter and citing @Kalshi, markets are now pricing in a total of three Federal Reserve interest rate cuts for 2025 following the latest Fed decision. Rate cut expectations have decreased by 25 basis points since their peak in April, reflecting a shift in monetary policy outlook. Despite this moderation, former President Trump continues to call for immediate rate reductions. For crypto traders, the adjusted rate cut timeline could lead to reduced speculative inflows and increased market volatility, especially as monetary policy directly influences liquidity and risk appetite in the digital asset space (source: @KobeissiLetter, @Kalshi).

According to The Kobeissi Letter, markets have now fully priced in four 25 basis point interest rate cuts by the end of 2025, reflecting expectations that the Federal Reserve will prioritize addressing declining US economic output over concerns about a potential inflation rebound (source: The Kobeissi Letter, Twitter, April 30, 2025). This outlook signals potential shifts in USD liquidity, which could impact risk assets including Bitcoin and Ethereum. Traders should monitor Fed meeting signals and US economic data releases, as rate cut expectations historically lead to increased volatility in both traditional and crypto markets. The current consensus may fuel bullish sentiment in crypto, particularly in altcoins sensitive to monetary policy shifts.