Quick recap of today's FOMC for crypto.
The Fed cut 25bps as expected, ended QT, and signaled T-bill purchases. That is supportive for liquidity, but still far from a 2020-style QE restart.
T-bills: “QE-lite” for liquidity
T-bill reinvestment and reserve management mean the balance sheet will stop shrinking and may slowly expand at the margin. For risk assets, that is a mildly dovish backdrop after two years of QT.
Dot plot: hawkish vs market pricing
The new dot plot still centers on only one additional cut over the coming year, while futures had been implying a more aggressive easing path. For markets leaning toward multiple cuts, this reads as a hawkish surprise.
Powell’s tone: data-dependent, not in a rush.
In the press conference, Powell framed the current rate as a level where the Fed can “wait and see” how the data evolve, rather than pre-committing to further cuts. The bar for additional cuts remains meaningful.
How crypto traded.
BTC initially spiked on the headline cut + QT end, then faded as the hawkish details (dot plot, Powell tone) sank in. Classic “spike then sell-the-news” price action after a long period of optimistic pricing around liquidity and cuts.
Positioning and “already priced in”.
Much of the easing story (QT endin\g, the first cuts, better liquidity) had been priced into crypto. With the Fed only signaling one more cut and no strong commitment beyond that, the event became a convenient excuse to take profit and lighten risk.
Implementation detail: when T-bill buying starts.
The Fed also noted that Treasury bill purchases will begin on December 12 as part of its reserve-management operations. That’s another sign that balance sheet dynamics are shifting from steady runoff toward mild, technical expansion.
Big picture.
Net-net, the decision adds some support on the liquidity side but keeps the policy path tighter than many had hoped. For crypto, it is less about one meeting and more about how positioning and narratives adjust from “multi-cut” to slow, data-dependent easing.