The Federal Reserve (Fed) released the minutes of its June 16–17 meeting, and this document caused notable movement in the cryptocurrency market. All 12 voting committee members unanimously voted to keep the rate at 3.50–3.75%, but behind this unanimous decision lie serious internal disagreements.
Division within the Fed: Inflation and the Rate
Despite formal unity, the minutes revealed deep divisions. Several meeting participants, including Chairman Jerome Powell himself, insisted on the need to raise the rate as early as June, citing persistent inflation risks. However, the majority considered it premature to change course, pointing to uncertainty related to trade tariffs, rising energy prices in the Middle East, and unprecedented demand for technology, data centers, and electricity driven by the artificial intelligence boom.
As a result of the vote, 9 out of 19 officials expect at least one rate hike by the end of 2026. Until recently, such forecasts were not made at all. Powell himself, commenting on the situation at a press conference, called the discussion a "real family squabble for a couple of days" but emphasized that the committee ultimately reached a consensus.
Inflation and AI: A New Factor of Uncertainty
Fed experts raised inflation expectations for 2026–2027. Key drivers include tariff increases, supply disruptions from Middle Eastern countries, and sharp investments in AI infrastructure. Core inflation stood at 3.3% in April and around 3.4% in May, significantly above the Fed's 2% target. Some meeting participants believe that AI spending could reduce costs in the long term due to productivity gains, but this effect will take several years to materialize. For now, demand for data centers and high-tech equipment continues to push prices upward.
Bitcoin: Market Reaction
At the time of writing this analysis, Bitcoin (BTC) is trading around $62,240, with its price dropping approximately 2.7% over the past day. The market reacted to the publication of the minutes, which highlighted the lack of a clear rate forecast from Powell as the main source of uncertainty. The decline occurred amid activity in the Bitcoin options market: shortly before the publication, investors were betting on a rise, following Bitcoin's rebound to $64,000 thanks to positive ETF inflows. This dynamic underscores the crypto market's sensitivity to rate expectations—a similar scenario previously played out during the dispute over the Fed's independence involving Lisa Cook.
Analysts note an increasingly close connection between macroeconomics and the crypto market. Before the minutes were published, Ryan Kirkley, co-founder and CEO of Global Settlement Network, pointed out that the dynamics of oil, Treasury yields, and the dollar already reflect a shift in expectations: markets are pricing in prolonged inflation rather than a short-term spike. The minutes confirmed this trend—the document attributed the rise in inflation to increased demand from AI development, tariffs, and energy costs from the Middle East.
"The crypto market now reacts to oil, interest rates, the dollar, and bond yields... Macroeconomics directly impacts crypto."
The next FOMC meeting will take place on July 28–29. Inflation remains above target, and nine committee members lean toward tightening policy. New inflation and labor market data will be decisive in determining whether the internal dispute within the Fed, which Powell called a "family conflict," will continue with a rate hike or a pause.
Analyst's Comment: The Bitcoin market is showing a classic reaction to uncertainty in monetary policy. Until the Fed provides clear signals on the rate, volatility will persist, and BTC will remain hostage to macroeconomic data. Investors should prepare for further fluctuations until the July meeting.