Bitcoin News Today: Federal Reserve Drama Could Determine Bitcoin's Next Move

Bitcoin’s trajectory remains inextricably linked to U.S. monetary policy, with market observers and policymakers emphasizing that the cryptocurrency will not achieve broader institutional adoption until a new Federal Reserve chair is appointed by President Donald Trump. Recent developments, particularly Treasury Secretary Scott Bessent’s comments on potential rate cuts and the administration’s evolving stance on Bitcoin, underscore the growing influence of regulatory and monetary signals on crypto markets.

The U.S. Treasury’s strategic reserve of Bitcoin has emerged as a focal point for investors and analysts, with Bessent disclosing that the government holds between $15 billion and $20 billion worth of the asset—substantially less than the $23 billion previously estimated. This revelation followed reports indicating the U.S. Marshals Service held fewer than 30,000 Bitcoin, a figure that would place the U.S. behind China, the United Kingdom, and Ukraine in global rankings. The administration’s approach to expanding the reserve remains unclear, with Bessent acknowledging that the reserve would be funded through confiscated assets rather than additional government purchases.

Bessent’s remarks also hinted at the possibility of a 50-basis-point interest rate cut in September, a significant departure from market expectations of a 25-basis-point reduction. Such a move, if enacted, could reignite momentum in the crypto market, which has seen Bitcoin and other cryptocurrencies pull back from record highs amid cooling rate cut expectations following hotter-than-anticipated inflation data. The U.S. Producer Price Index (PPI) surged by 0.9% in July, marking the first such increase in three years, and raising concerns about inflationary pressures stemming from Trump’s tariff policies.

The Federal Reserve’s upcoming decisions will be closely monitored by market participants. The uncertainty surrounding monetary policy has already prompted a recalibration of investor expectations, with the CME FedWatch tool indicating a reduced outlook of two rate cuts by year-end, down from three. The Fed’s annual Jackson Hole Economic Symposium, where Chair Jerome Powell is set to deliver a key speech on August 23, will likely provide further clarity on the central bank’s stance and its potential impact on Bitcoin and other risk assets.

White House officials, including crypto czar David Sacks, have indicated that the administration is committed to exploring budget-neutral methods to acquire more Bitcoin, such as reallocating government gold reserves. However, the Trump administration’s broader legislative agenda appears to take precedence, with the Genius Act and a separate crypto market structure bill currently moving through Congress. These legislative efforts, which focus on stablecoin regulation and market infrastructure, are expected to shape the regulatory landscape before the administration turns its attention to expanding the Bitcoin reserve.

In summary, the interplay between U.S. monetary policy, regulatory developments, and strategic asset allocation continues to define Bitcoin’s near-term prospects. The market awaits a definitive signal from the Trump administration—particularly the nomination of a new Fed chair—to determine the next phase of institutional adoption and price trajectory for the cryptocurrency.

Source:

[1] Treasury Secretary Issues Surprise September Fed ... (https://www.forbes.com/sites/digital-assets/2025/08/16/treasury-secretary-reveals-us-bitcoin-surprise-triggering-price-shockwaves/)

[2] Fading Fed Rate Cut Hopes: Is a Bitcoin Price Drop Next? (https://www.mitrade.com/insights/news/live-news/article-3-1046487-20250818)

[3] Bitcoin, Ethereum slip as crypto markets pull back after hitting ... (https://finance.yahoo.com/news/bitcoin-ethereum-slip-as-crypto-markets-pull-back-after-hitting-2025-highs-155818704.html)

[4] MiCA vs. GENIUS Act: How Crypto Laws Differ in Europe ... (https://www.ccn.com/education/crypto/mica-vs-genius-act-how-crypto-laws-differ-in-europe-and-the-us/)

[5] Cryptocurrency Regulation: A Guide to U.S. & Global Policies (https://www.britannica.com/money/cryptocurrency-regulation)

[6] EU Finalizes Crypto Rule for Banks (https://www.bankingexchange.com/news-feed/item/10386-eu-finalizes-crypto-rule-for-banks)