Bitcoin Drops to $75,000 After Fed Holds Rates Steady at 3.5–3.75%

Bitcoin shed over $1,000 on the evening of April 29 after the Federal Reserve announced it would leave interest rates unchanged. Other major crypto assets followed BTC lower.

Market reaction to the FOMC decision

The Federal Open Market Committee voted eight to four to maintain the federal funds rate in the 3.5–3.75% range. Policymakers cited persistent inflationary pressure driven by rising global energy prices and warned that the situation in the Middle East creates a "high level of uncertainty" for economic forecasts.

Within the first hour of the announcement, Bitcoin dropped from approximately $76,200 to the $75,000 area before bouncing to $75,760.

Ethereum, Solana, and XRP extended declines that had begun earlier in the day.

Why it matters

The rate hold itself was no surprise. The CME FedWatch tool had shown a near-100% probability of a pause heading into the meeting, meaning the decision was almost entirely priced in. That explains the relatively modest pullback in BTC rather than a deeper sell-off.

However, the Fed's hawkish tone — emphasizing ongoing inflation and geopolitical risks — may continue to weigh on risk appetite in the near term. For crypto markets, this signals that monetary easing remains uncertain, which could cap upside momentum.

CLARITY Act emerges as the real catalyst

Several analysts argue that the Fed decision is not the primary price driver for Bitcoin at this stage. Iggy Ioppe, Chief Investment Officer at Theo, told The Block that the most significant catalyst for BTC right now is not the FOMC but the CLARITY Act.

According to Ioppe, the bill would make the infrastructure around Bitcoin significantly more bank-friendly. It formally designates the leading cryptocurrency as a commodity under CFTC jurisdiction, removes the risk of excessive SEC intervention, and allows banks to custody the asset without onerous capital requirements.

The legislation is advancing through Congress, but contentious provisions — particularly around stablecoin regulation and ethics rules — are slowing its progress.

Additional pressure points

Ioppe also highlighted upcoming earnings reports from "Magnificent Seven" members — Alphabet, Amazon, Meta, and Microsoft — as a short-term factor that could influence risk assets, Bitcoin included.

Previously, Tudor Investment founder Paul Tudor Jones called Bitcoin the best hedge against inflation. With the Fed reiterating concerns about inflationary pressures, that thesis may gain additional traction among institutional allocators looking for alternatives to traditional safe havens.