Interest rate cuts are a double-edged sword: short-term euphoria and long-term concerns.

After the Federal Reserve signaled a rate cut in September 2025, the cryptocurrency market exhibited a typical "loose monetary" response.

Bitcoin rose 12% in the first week of interest rate cuts, while Ethereum increased by 15%. This short-term rise aligns perfectly with historical trends.

The interest rate cut directly reduces the opportunity cost of holding non-yielding assets, making assets like Bitcoin, which do not generate cash flow, more attractive.

At the same time, the expansion of U.S. dollar liquidity has driven a significant influx of funds into high-risk assets, markedly increasing the overall risk appetite in the cryptocurrency market.

This interest rate cut cycle is different from previous ones: "Compared to the interest rate cuts in 2020, the market reaction this time is more rational, and the participation of institutional investors has significantly increased, thanks to the clarification of regulatory policies."

However, the interest rate cut does not bring only benefits.

The market quickly realized that the Federal Reserve's interest rate cut was a confirmation of economic slowdown, and the ensuing concerns about economic recession began to suppress market sentiment. After the initial excitement of the rate cut, market attention shifted to the macroeconomic fundamentals.

"Historical data shows that in the first three months of a rate cut cycle, the average returns of cryptocurrencies are positive, but as recession signals become clearer, the market often experiences significant corrections." This divergence between short-term and long-term impacts makes the market trends in the second half of 2025 highly uncertain. $BTC $ETH #十月降息预测