A popular crypto analyst predicts a massive surge in Bitcoin and altcoins as the U.S. Federal Reserve is now 99.9% likely to cut interest rates this month.
Crypto trader and market analyst Cyclop believes the rate cut could push Bitcoin to a new all-time high of $130,000, followed by a large-cap altcoin rally and the start of a full-blown altseason. However, he cautions that short-term volatility is likely during this period.
According to Cyclop, current market indicators show a 99.9% probability that the Federal Reserve will reduce interest rates in June 2025.
Recent U.S. economic data supports this claim:
Historically, interest rate cuts have been bullish catalysts for crypto markets. Lower rates boost liquidity, reduce borrowing costs, and encourage risk-on investment behavior, leading to:
“Cheaper borrowing and rising liquidity create a perfect storm for crypto rallies,” notes Cyclop.
In early 2023, after a significant rate cut, Bitcoin surged by over 20% within weeks. But not all rate cuts guarantee bullish outcomes.
In 2024, a minor 25 basis point cut led to a 6% drop in BTC shortly after, highlighting the importance of broader macro conditions.
According to Cyclop, the bullish impact of a Fed rate cut on Bitcoin and altcoins will depend on three key conditions:
Currently, inflation is at 2.4%, and unemployment sits at 4.2%. Meanwhile, Trump’s tariffs are still being reviewed by a U.S. appeals court. A final decision is expected after July 31, but reports hint at a potential deal with China on rare earths and new tariff agreements with other nations.
If these conditions align with the Fed rate cut, Cyclop sees Bitcoin climbing to $130,000 in 2025. He also predicts that altseason could peak in November or December. However, he warns that short-term market fluctuations are inevitable, even if long-term sentiment remains bullish.
Slightly rising inflation (2.4%) and stable unemployment (4.2%) below key thresholds suggest the Fed might proceed with rate cuts. This is generally bullish for crypto as it encourages risk-on investment behavior due to increased liquidity.
Despite bullish long-term predictions, rate cuts often induce short-term volatility. This is due to profit-taking, leveraged positions being wiped out, and uncertainty around market expectations, leading to rapid price swings.
Yes, clarity around Trump’s proposed tariffs and any potential trade deals with China (especially on rare earths) could significantly influence the crypto market. Positive resolutions tend to support risk assets like crypto by reducing global economic uncertainty.
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