Even before Fed Chairman Jerome Powell took the stage on Wednesday afternoon, the verdict was already in; a cut was on the way. At least that’s what the CME Fedwatch Tool showed just minutes prior to Powell’s speech. The tool, which predicts rates by looking at expectations in the futures markets, showed a 90% probability of a 25-basis-point reduction, and that’s exactly what Powell delivered. But will bitcoin rally or was the cut already priced in?

(Futures markets showed a 90% probability of a 25-basis-point interest rate reduction just minutes before the Fed announced its decision / cmegroup.com

The cryptocurrency has been rather unpredictable in its reactions to macroeconomic conditions. When ADP reported a surprise jump in private sector job cuts, the cryptocurrency climbed 2%. BTC’s price action has been so counterintuitive lately that many credible experts like Custodia Bank CEO Caitlin Long are even suspecting price manipulation.

Read more: Even Andrew Tate Suspects Bitcoin Whales Are Manipulating Its Price

And now, despite a cut, bitcoin barely budged immediately after the announcement. In the cryptocurrency’s defense, the rate decision was made in the context of a somewhat divided Fed. Although nine out of twelve members of the Federal Open Market Committee (FOMC) voted for today’s reduction, the group was divided over the future direction of interest rates, causing some to describe the decision as a “hawkish cut.”

The central bank’s dual mandate of maintaining stable prices and maximum employment has become increasingly difficult to achieve, resulting in a wider range of proposed solutions by committee members. That diversity of views at the Fed may very well translate into a murky outlook for bitcoin’s price in the future.

“It’s very unusual to have persistent tension between the two parts of the mandate, and when you do, this is what you see,” Powell explained in response to questions about increasingly diverse views within the FOMC. “I think it’s actually what you would expect to see.”

Bitcoin was trading at $92,506.84 at the time of reporting, down slightly by 0.57% over 24 hours and lower by 0.81% for the week, Coinmarketcap data shows. The digital asset reached a low of $91,640.13 on Wednesday and rose to $94,477.16.

( BTC price / Trading View)

Daily trading volume was mostly flat, edging lower by 1.17% for the day to reach $65.64 billion. Market capitalization stood at $1.84 trillion, and bitcoin dominance slipped once again, this time easing 0.16% to reach 59.01%.

( BTC dominance / Trading View)

Total bitcoin futures open interest was also flat, inching upward by 0.40% to $59.14 billion, according to Coinglass. Liquidations were lower than Tuesday’s, coming in at $102.56 million. Most of the losses were attributable to long investors who saw $65.46 million in margin wiped out. Short sellers lost roughly half that amount, or approximately $37.10 million.

• Why did the Fed cut rates today?
  The central bank lowered its target rate by 25 basis points due to slowing growth and rising pressure from both sides of its dual mandate.
• Was the bitcoin market expecting this cut?
  The CME FedWatch Tool showed a 90% probability of a cut, meaning the decision was largely priced in.
• Why didn’t bitcoin rally after the announcement?
  BTC barely moved because the cut was expected, and the Fed’s mixed outlook created uncertainty for risk assets.
• How could divided views within the Fed affect bitcoin?
  A wider range of rate expectations among FOMC members clouds the policy path, increasing volatility and making BTC’s direction harder to predict.

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