Bitcoin extends weakness after the Fed’s third rate cut as on-chain data show realized losses at -18%, still far from the -37% capitulation zone seen at past bottoms.
Summary
- The Fed delivered a third straight 25 bps cut to 3.5%–3.75%, with one Trump-appointed official pushing for a deeper 50 bps move.
- On-chain data from Ali Charts show Bitcoin trader realized losses near -18%, still well above the -37% level that has marked major cycle lows.
- Short-term holders are selling into weakness while long-term holders accumulate, keeping BTC pinned near support despite looser monetary policy.
Bitcoin (BTC) may experience additional price declines despite three consecutive interest rate cuts by the Federal Reserve, according to on-chain data analysis.
The Federal Reserve announced its third consecutive rate reduction on Wednesday, lowering the federal funds rate by 0.25 percentage points to a range of 3.5% to 3.75%. Trump appointee Stephen Miran dissented from the decision, advocating instead for a larger 0.50 percentage point cut.
FED delivers 3rd straight rate cut
On-chain metrics indicate Bitcoin has not yet reached its historical bottom, according to data from Ali Charts. The analysis shows realized losses currently stand at negative 18%, well above the negative 37% threshold that has historically signaled strong buying opportunities during previous market cycles.
Realized losses measure actual losses incurred by traders when selling assets, distinguishing them from unrealized losses on held positions. Lower readings typically indicate capitulation events, which have historically provided entry points for long-term investors.
Despite the Fed’s monetary easing policy, Bitcoin continues to trade at support levels. Traditional safe-haven assets have outperformed digital assets in recent periods, according to market observers. Policy analyst Daugherty noted that President Trump and Scott Besent had predicted the policy shift.
The dissenting vote reflects internal debate regarding the magnitude of rate cuts. Markets are pricing in potential additional cuts through 2026.
On-chain data provides context for current price movements. The negative 37% realized loss threshold has historically preceded strong Bitcoin recoveries across multiple market cycles. Current readings suggest selling pressure has not yet reached capitulation levels.
Market structure shows divergent behavior between different holder cohorts. Short-term holders are applying selling pressure, while long-term holders continue accumulating at current price levels, according to the analysis. This divergence contributes to ongoing market volatility.
Some market participants attribute Bitcoin’s weakness to profit-taking following previous gains, while others cite regulatory uncertainty as a factor affecting market sentiment.
