Fed Rate Cuts Spark Q4 Crypto Rally: Bitcoin and Altcoins Set to Explode

Strap in, crypto fans—the Fed just handed digital assets a golden ticket.

Monetary Policy Unleashed

With Jerome Powell signaling more rate cuts ahead, traditional finance's grip loosens. Money floods toward higher-yielding opportunities—and crypto's looking mighty attractive right now.

Bitcoin Leads the Charge

King BTC typically rallies when liquidity conditions ease. This cycle proves no different as institutional money positions for the coming stimulus wave.

Altcoins Catch the Wave

Ethereum, Solana, and smaller caps historically outperform when Bitcoin breaks upward. Smart money's already rotating into high-beta plays before the retail frenzy begins.

Timing the Peak

Every trader knows the drill—buy the rumor, sell the news. The real trick? exiting before the Fed changes its mind again and Wall Street 'discovers' newfound inflation concerns.

The U.S. Federal Reserve has ended its 10-month pause, cutting interest rates by 25 basis points this week. But the real bombshell isn’t the cut itself. It’s what comes next. Fed signals now point to multiple rate cuts ahead, a shift that could unleash fresh liquidity into markets. 

And according to crypto analyst VirtualBacon, this could be the spark that sends Bitcoin and major altcoins into a powerful Q4 rally.

Fed Signals 1-2 More Cuts Ahead

VirtualBacon pointed out that the Fed’s DOT plots now suggest one to two more rate cuts by December. This easing cycle is important because lower interest rates usually boost high-risk assets like Bitcoin, making it easier for investors to put money into crypto.

The CME FedWatch data supports this view:

• October meeting: 91% chance of a rate cut
• December meeting: 83% chance of another cut
• Less than 1% chance of no more cuts in 2025

The focus has shifted from “if” the Fed will cut rates again to “how many times,” which is a positive sign for crypto markets.

Jobs Data Driving Policy Shift

The Fed’s decision is heavily influenced by slower job growth. Annual revisions between May and August cut 911,000 jobs from 2024–25 totals, showing employment is weaker than expected.

Fed Chair Powell noted that jobs are more important than inflation right now, signaling a dovish stance that supports market liquidity. However, Powell carefully avoided labeling this MOVE a “one-and-done,” instead pointing to the dot plots, code for “more cuts are on the table.”

Why Bitcoin & Altcoin Could Rally in Q4?

Rate cuts generally weaken the U.S. dollar and inject liquidity into risk assets like bitcoin altcoin.

• Bitcoin is likely to benefit from increased liquidity and softer dollar conditions.
• Large-cap altcoins like Ethereum, Solana, XRP, and Binance Coin are already seeing rotation.
• Analysts suggest this is a quarter-long trend, not a short-term spike, with altcoins likely to gain as Bitcoin dominance trends lower.

Even with quantitative tightening continuing at a minimal pace of $5 billion per month, the main driver for crypto is rate cuts, setting up ideal conditions for a late-year rally.

Therefore, VirtualBacon’s analysis shows that the Fed’s policy shift could trigger a strong rally in Bitcoin and altcoins through Q4, giving crypto markets a potentially powerful finish to 2025.