Bitcoin Teeters Near $64K After Fed Revives Rate-Hike Fears, Triggering Broader Market Sell-Off

Bitcoin fell alongside major stock indices after Federal Reserve projections revived the risk of future interest rate hikes, leaving the cryptocurrency under pressure near the $64,000 mark. Although the Federal Open Market Committee voted to hold its target interest rate range at 3.50% to 3.75%, the central bank’s updated dot-plot projections signaled a tightening policy outlook. Nine of the eighteen submitted projections now point to at least one rate hike before the end of the year, representing a sharp shift from just three months ago when market participants were anticipating rate cuts. Following the news, Bitcoin dipped approximately 2%, trading near $64,300 with an intraday low of $63,950, as traders rapidly adjusted to the hawkish macro signal, CryptoSlate said in a report.

The policy shift triggered an immediate reaction across traditional and digital asset markets alike during what was Kevin Warsh’s first meeting as Fed Chair. Rate markets swiftly moved to price in a 72% probability of a rate hike by October, while December hike odds surged to roughly 78%. This hawkish tone sparked a broader risk-off move that impacted multiple asset classes, pushing the Dow Jones Industrial Average down 1.01%, the S&P 500 down 1.28%, and the Nasdaq off 1.45%. Simultaneously, the 10-year Treasury yield climbed to 4.467% and the US dollar strengthened, compounding the downward pressure on high-beta risk assets like Bitcoin.

On-chain data from Glassnode suggests that while the market is stabilizing, a full structural recovery has not yet materialized. Bitcoin currently trades roughly 15% below its True Market Mean of $77,200, a metric Glassnode uses to distinguish a structural bull market from a bear regime. Furthermore, the short-term holder Market Value to Realized Value ratio stands at 0.90, indicating that recent buyers are still about 10% underwater relative to their implied cost basis of $72,600. This dynamic creates a persistent layer of overhead supply from investors looking to break even during market rallies, while capital flow metrics show that the network’s Realized Cap has contracted by 1.45% over the past 90 days.

Despite these overhead hurdles, Bitcoin’s underlying market microstructure has shown signs of gradual improvement. Order books indicate that spot liquidity is rebuilding on the bid side, meaning passive buyers are now absorbing selling pressure more efficiently than they did during the initial drop toward $60,000. Options market volatility has normalized, and forced bearish hedging pressure has eased. Moving forward, Bitcoin faces two distinct paths: a bullish scenario driven by easing hike fears that pushes the asset past its $72,600 short-term holder cost basis toward the True Market Mean, or a cautious continuation of range-bound trading as macroeconomic tightening and competing tech stocks cap any immediate upside.