Asia Market Overview: Bitcoin Dips as Fed Rate Cuts Provide Stocks a Boost

In the early hours of trading on Thursday, Bitcoin experienced a decline of approximately 2% as regional stock markets surged following the Federal Reserve’s recent interest rate cut and an optimistic outlook for the US economy. The Fed's third consecutive reduction in rates has led to a cautious reassessment of future cuts while traders remain vigilant about market risks.

Key Takeaways

Bitcoin fell by about 2.3% to $90,121.
The Federal Reserve enacted a third consecutive quarter-point rate cut, anticipating only one more cut in 2026.
Asian equities recorded gains, with tech and financial sectors leading the charge.
Mixed risk sentiment was noted across Greater China, with varying performance in regional indexes.

Bitcoin

Main Content

Bitcoin saw a dip of roughly 2% in early Asian trading on Thursday, coinciding with a continued rally in regional equities that followed the Federal Reserve's most recent decision to cut interest rates and a positive outlook for the US economy.

The Federal Reserve implemented a third consecutive quarter-point reduction, with Chair Jerome Powell indicating that the inflation pressures resulting from tariffs are expected to diminish as the US economy strengthens. He characterized this rate cut as a step towards normalizing policy and emphasized the importance of supporting job growth without triggering renewed inflationary pressures.

Nine out of twelve members of the Federal Reserve’s policy committee supported this reduction, and recent projections indicate that officials expect only one additional rate cut in 2026.

Market Snapshot

Bitcoin: $90,121, down 2.3%
Ether: $3,224, down 2.4%
XRP: $2.01, down 3.9%
Total crypto market cap: $3.16 trillion, down 2.4%

Market Sentiment and Future Expectations

Futures trading suggests there is now about a 78% probability that the Fed will keep rates unchanged at its next meeting, a rise from around 70% before the decision. This has caused traders to reassess how far the current easing cycle can extend.

Nic Puckrin, an investment analyst and co-founder of The Coin Bureau, commented that the Federal Open Market Committee (FOMC) decision was not as aggressive as many market participants had anticipated, leading to a sense of relief in the markets.

He pointed out, however, that the Fed is only expected to implement one rate cut next year, which is fewer than many investors had hoped for. Puckrin acknowledged that while the current announcement may not be enough to trigger a surge in Bitcoin prices, unexpected developments, such as announcements from President Donald Trump, could generate interest in the market. Nonetheless, he noted the potential for volatility, stating that risk assets often prioritize the Fed’s decisions above other influences.

Performance of Regional Markets

Asian stocks gained momentum from Wall Street, where the S&P 500 index rose by 0.7% and the Russell 2000, which tracks small-cap stocks, increased by 1.3% to reach new highs. The MSCI Asia Pacific Index rose about 0.5% in initial trading, with technology and financial stocks attracting most of the buying activity.

There was a mixed sentiment regarding risk appetite across Greater China. The Shanghai Composite index fell by 0.18%, while the Dow Jones Shanghai index decreased by 0.10%. Conversely, Hong Kong’s Hang Seng index gained 0.4% as investors showed renewed interest in some major stocks in the area. For cryptocurrency traders, the recovery in Hong Kong serves as a reminder that equity risk sentiment often aligns with demand for growth-oriented projects in China and higher-risk tokens.

In the US, tech sentiment turned more cautious during post-market trading. Nasdaq 100 futures were about 0.3% lower in Asian hours after Oracle announced revenues that did not meet expectations, resulting in a sharp decline in the company's stock. Nvidia also experienced a slight downturn, indicating that investors may be reducing their positions in some overvalued artificial intelligence stocks, which are typically found alongside major cryptocurrencies in investment portfolios.