Markets are divided on whether the Federal Reserve will raise rates or hold rates on Wednesday, but analysts say bitcoin They may be less vulnerable than AI-powered tech stocks.
bitcoin recovered from its intraday losses to trade steady just below $64,000 on Tuesday, while AI-linked technology stocks stumbled again ahead of one of the most uncertain Federal Reserve meetings in years.
Markets are currently pricing in a 70% chance of the Federal Reserve leaving rates unchanged on Wednesday and a 30% chance of a surprise 25 basis point hike, CME FedWatch data shows. The split reflects Chairman Kevin Warsh’s reduced use of forward guidance, leaving investors with less clarity about the central bank’s next move, according to derivatives analysis firm Block Scholes.
“Tomorrow’s FOMC meeting, Kevin Warsh’s second as Federal Reserve chair, is one of the most uncertain in years,” said Thahbib Rahman, research analyst at Block Scholes. Looking at all Fed meetings since 2015, he noted that only two have seen markets more divided on the outcome.
Signs of uncoupling
Even with that uncertainty hanging over the markets, bitcoin has largely held firm in July while chipmakers and other AI darlings have come under pressure, raising the possibility that cryptocurrencies are starting to diverge, at least at the margin, from traditional risk assets.
