A Fed Decision That Stirred the Market

Bitcoin saw sharp intraday swings on December 10, 2025 after the U.S. Federal Reserve delivered a widely expected 25 basis point rate cut. The new target range of 3.50 to 3.75 percent marked the third consecutive reduction this year. Traders initially welcomed the move, but the enthusiasm faded once Chair Jerome Powell began outlining the challenges facing the economy.

Powell noted that the labor market is cooling while inflation remains stubborn. That combination leaves the central bank in a difficult position and created uncertainty across both traditional and digital asset markets.

Why Bitcoin Reacted So Strongly

Bitcoin tends to move quickly around macro announcements. A rate cut normally boosts risk appetite because cheaper borrowing and easier liquidity often support asset prices. This time, however, Powell’s tone was cautious. He highlighted ongoing inflation concerns and signaled that future cuts are not guaranteed.

That message pulled sentiment in two directions:

• The cut itself encouraged traders to buy.

• The uncertain outlook made them hesitate.

As a result, Bitcoin briefly pushed toward the mid 90,000 dollar range before falling back under 90,000 dollars. Thin liquidity amplified the swings.

The Market Was Already Positioned for Volatility

Ahead of the meeting, Bitcoin had climbed above 92,000 dollars as traders anticipated a supportive tone from the Fed. ETF flows and strong speculative interest helped lift the market. Once the announcement arrived, profit taking kicked in and price action turned choppy.

This pattern is common when expectations are strong. If traders already positioned for positive news, even a slight shift in tone can trigger rapid reversals.

What Powell Meant by “Threading the Needle”

Several analysts described Powell’s strategy as threading the needle between two competing mandates. The Fed must support employment, but it must also maintain price stability. With job growth slowing and inflation not yet returning to target, Powell avoided any strong commitment about the next steps.

For Bitcoin, this means macro uncertainty may remain elevated in the near term. Traders often look for clear direction from central banks, and Powell delivered a more balanced, careful message.

What This Signals for Crypto Going Forward

The December 10 meeting confirmed something that has been developing for years. Bitcoin now reacts more to macro policy than earlier in its history. Interest rate decisions, jobs data and inflation expectations all influence how traders approach digital assets.

The takeaway is simple. Bitcoin is now seen as part of the broader financial system. When central banks speak, crypto markets listen.