Analyzing Bitcoin’s rally as Waller’s Fed stance makes rate call a 50-50 coin toss
Comments from Warsh and Waller have led to sizeable intraday Bitcoin price moves.
Last week, Federal Reserve Chair Kevin Warsh’s hawkish speech at the Jackson Hole event led to a Bitcoin [BTC] price drop to $77k. The Fed was not yet done fighting inflation, and this news raised the odds of a rate hike to 57%.
On Thursday, the 3rd of September, Bitcoin rallied 5% in a day following Fed Governor Christopher Waller’s comments. Speaking at a Reuters event, Waller indicated that he would be inclined to support keeping interest rates unchanged during the September meeting.
The same day also saw $730.8 million net flows into spot BTC ETFs, highlighting strong demand.
This Bitcoin price move led to an uptick across the crypto market. It also slashed the odds of a rate hike from 57% to closer to 50%, according to the CME FedWatch Tool.
It is now a coin toss whether interest rates remain unchanged or face a hike. Any event from now to the announcement that gives some certainty to an outcome will be likely to move markets to a greater extent.
The impact of the Fed’s decision on crypto
In 2026, the days around the FOMC rate decision have tended to be clear price pivot points. For example, the decisions in January, March, and June saw a bearish reaction from Bitcoin, with heightened liquidation numbers.
Even if the Fed’s September decision is to hold interest rates steady, it could have a bearish impact on crypto.
In 2022, to fight high inflation rates, the Fed raised interest rates from 0.25% to 4.50%. The swift tightening cycle sucked capital out of crypto and accelerated the BTC bear market.
A decision to increase interest rates would signal that the trend has changed. The cost of capital would be rising once again and could force Bitcoin to reprice accordingly.
On the other hand, dovish signals from the Fed would increase the chances of a bullish scenario for crypto. If spot ETF flows keep up the inflow streak, and BTC demand accelerates, it could bode well for a true bull market shift.
Final Summary
- Comments from Warsh and Waller have led to sizeable intraday Bitcoin price moves.
- The 2026 track record for decisions to hold interest rates has been bearish, with just one bullish BTC price reaction in April.
