Fed rate cuts and liquidity conditions may fuel major crypto rally
Bitcoin and Ether could see a powerful rally in the final quarter of this year, according to Fundstrat co-founder and BitMine chairman Tom Lee. Speaking on CNBC, Lee said that easing monetary policy and improving global liquidity could set the stage for what he called a “monster move” in the next three months.
Fed rate cuts as catalyst
Lee highlighted that the Federal Reserve is expected to cut interest rates for the first time this year, a move he believes will provide a significant boost to risk assets like Bitcoin and Ether. Futures markets currently anticipate a 25 basis point cut, though there is a slim chance of a larger 50-point reduction.
“The Fed can actually reinject confidence by saying we’re back into an easing cycle,” Lee said, noting that similar conditions in September 1998 and 2024 triggered strong rallies in markets.
Bitcoin and Ether as liquidity-sensitive assets
According to Lee, Bitcoin remains highly sensitive to monetary policy shifts, while Ethereum represents both a liquidity-sensitive asset and a growth protocol. “Ethereum almost trades like 1971 Wall Street when the dollar went off the gold standard and there was a lot of innovation,” he explained.
He also pointed to Ethereum’s role in powering new technologies, describing it as central to the convergence of AI, stablecoins, and blockchain adoption on Wall Street.
Institutional positioning and BitMine’s strategy
BitMine, where Lee serves as chairman, has been aggressively accumulating Ether. In its latest update, the company disclosed $10.77 billion in cash and crypto holdings, including 2.15 million ETH valued at $9.7 billion — roughly 1.8% of Ethereum’s total supply.
“The convergence of both Wall Street moving onto the blockchain and AI creating a token economy is creating a supercycle for Ethereum,” Lee said.
At the time of writing, Bitcoin was trading at $115,797, while Ethereum stood at $4,508. Despite short-term fluctuations, Lee believes the next three months could deliver one of the standout trades of 2025, as liquidity conditions align with seasonal tailwinds.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.