Market Priced In Cuts. The Fed Floated Hikes. Bitcoin Felt It.
Markets were leaning toward rate cuts in 2026.
Instead, the Federal Reserve signaled the door to further tightening isn’t fully closed.
Bitcoin reacted fast.
BTC slipped as Treasury yields ticked higher and the dollar strengthened, a classic liquidity squeeze response. Risk assets don’t like surprises, especially hawkish ones.
With Bitcoin still trading well below its all-time high, the shift in rate expectations matters. Crypto has thrived in easing cycles. It has struggled in tightening ones.
Historically, when the Fed pivots hawkish against market expectations, volatility spikes across equities and digital assets. Liquidity drives momentum. Policy drives liquidity.
The key question now: Was this forward guidance or a warning shot?
Liquidity repriced.
Risk recalibrated.
Volatility rising.
Bitcoin watching the Fed.