For Bitcoin traders, the real focus at the Fed meeting isn’t the rate decision, but another key data point.

Crypto Traders Zero In on Fed’s Dot Plot as Rate Decision Looms

The Federal Reserve is expected to keep interest rates steady on Wednesday, with markets now turning their focus to what comes next for monetary policy.

The Federal Open Market Committee (FOMC) will announce its decision at 18:00 UTC, followed by remarks from Chair Jerome Powell. According to CME Group’s FedWatch tool, traders overwhelmingly anticipate that rates will remain in the current 4.25%-4.50% range, despite pressure from President Donald Trump urging cuts to stimulate the economy.

But with the rate outcome considered a done deal, crypto traders are instead scrutinizing the Fed’s dot plot—the chart capturing each policymaker’s interest rate forecasts.

“Everyone knows rates are staying put this time,” said crypto trading firm XBTO in a note. “What matters is the dot plot. Less than two cuts projected would confirm a higher-for-longer stance. A dovish twist could soften the dollar and revive demand for crypto. Until clarity comes, the market stays cautious.”

A hawkish tilt in the projections could dampen crypto markets, especially as bitcoin has stalled above $100,000 amid geopolitical tensions and inflationary risks fueled by the Middle East conflict and ongoing trade disputes.

“Rate cut expectations for 2025 have already fallen from 100 basis points to just 50 basis points,” said Matteo Greco, senior analyst at Fineqia. “Strong jobs data and sticky inflation are behind this adjustment. If geopolitical risks worsen, markets may price in even fewer cuts, perhaps only 25 basis points.”

While a hawkish Fed could pressure crypto prices in the near term, higher rates might deepen concerns over U.S. debt costs, potentially bolstering the case for alternative stores of value like gold and bitcoin over the long run.