Bitcoin hovered around $65,000 on Wednesday after dipping to $64,500 earlier in the week, its lowest level in days, as traders braced for the U.S. Federal Reserve’s policy decision and weighed potential selling pressure from large holders.
Bitcoin steadies ahead of Fed decision
The BTC/USD pair recovered modestly into the Wall Street open following sustained downside pressure tied to anticipation of the Federal Open Market Committee’s rate announcement. The meeting drew heightened attention as markets looked for signals on the direction of monetary policy under new Chair Kevin Warsh.
Despite the bounce, Bitcoin struggled to reclaim the $66,000 level, reflecting cautious positioning across crypto markets.
Concerns over corporate and state selling
Part of the weakness stemmed from concerns that Strategy could sell additional Bitcoin to meet financial obligations after its $1.5 billion buyback of 2029 Convertible Senior Notes. The company had already sold 32 BTC in May as part of liquidity management, keeping traders alert to the risk of further offloading.
Separately, on-chain data showed the German government moving sizable Bitcoin holdings to exchanges, raising fears of increased supply hitting the market. These transfers added to uncertainty around near-term price stability.
Fed holds rates but signals tighter outlook
The Federal Reserve ultimately kept interest rates unchanged, but its updated projections signaled a more restrictive path than expected. Policymakers now anticipate only one quarter-point rate cut in 2026, down from three cuts projected in March.
This shift followed mixed inflation data. The Consumer Price Index rose 3.3% year-over-year in May, slightly easing, while core inflation remained elevated at 3.4%. Warsh said policymakers need several more months of favorable data before considering any policy adjustments.
Market data from CME Group showed no expectation of a rate cut at this meeting, while some analysts pointed to rising odds of a potential rate hike later in the year.
ETF outflows and macro pressure weigh on sentiment
Institutional momentum has also weakened, with U.S. spot Bitcoin ETFs recording sustained net outflows in recent weeks. Billions of dollars have exited these products, reversing earlier strong inflows and adding to downside pressure.
Key levels in focus
With tighter monetary policy expectations, ongoing ETF outflows, and the risk of increased supply from large holders, Bitcoin faces a challenging short-term environment. Traders are closely watching whether the $60,000 to $64,000 range can hold as a key support zone under current conditions.
For deeper insight into how rate moves sway BTC, read How Fed Rate Cuts Influence Bitcoin Volatility next.
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