Yeliz Akmaca 
The crypto markets face a critical moment as Federal Reserve (Fed) policymakers debate whether the next rate cut should be a cautious 25 basis points or a bold 50 basis points. This decision could reshape digital assets and challenge Bitcoin’s traditional four-year cycle. Analysts now emphasize liquidity over the halving schedule as the primary price driver.
Fed Policymakers Split Over Rate Cuts
Federal Reserve officials remain divided. Governor Chris Waller supports a modest 25 bp cut, citing economic uncertainty and delayed government data. “Based on all labor market data, I believe the FOMC should reduce the policy rate by 25 basis points at our October 29 meeting,” he said. Meanwhile, Stephen Miran favors a more aggressive 50 bp cut due to U.S.-China trade tensions and tariff concerns. Minneapolis Fed President Neel Kashkari backs cautious steps, viewing cuts as “insurance” against recession risks.
Impact of 25 vs 50 Basis Points on Crypto
A 25 bp cut may offer moderate support to crypto prices without triggering a full rally, reflecting a still cautious Fed. In contrast, a 50 bp cut signals more urgent monetary easing, potentially sparking stronger liquidity-driven rallies in Bitcoin, Ethereum, and altcoins. However, it may also raise concerns about underlying economic health.
The End of the 4-Year Bitcoin Cycle?
Crypto investors historically relied on Bitcoin’s four-year halving cycle for trend predictions. Many now argue that liquidity changes, driven by central bank policies, are the main catalyst.
Liquidity Signals and the New Crypto Playbook
Moderate Fed moves historically push capital into crypto, boosting prices. Rapid policy changes, however, signal macroeconomic weakness, carrying risks for both directions. Attention now focuses on policymakers, liquidity, and global economic flows as the next major crypto catalyst approaches.
What Happens If the Fed Raises Rates?
If the Fed increases by 25 bp, markets may see a “soft landing” effect: the dollar strengthens, and risky assets like Bitcoin and Ethereum could face mild selling pressure. A 50 bp increase signals aggressive tightening, reducing liquidity and prompting investors to move toward cash or bonds, which may cause sharper crypto price declines. While short-term volatility could rise, long-term confidence in economic stability may improve.
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